Gold Gains; USD Declines After Greece Wins EU Aid
Source: Bloomberg, Sungwoo Park (4/12/10)
"Gold rose for a sixth day, reaching a four-month high. . ."
The precious metal gained as much as 0.7% as the Dollar Index fell as much as 1.3%, the steepest loss since July 31. The U.S currency weakened as the euro surged to the highest level in more than three weeks after European governments offered Greece a rescue package worth as much as 45 billion euros ($61 billion) at below-market interest rates.
"The dollar is falling as risks in the European zone are being eased," said Chris Yoo, head of global derivatives at Samsung Futures Inc. in Seoul. "The euro is surging now and gold is gaining too."
Gold for immediate delivery rose as much as 0.7% to $1,170 an ounce, the highest level since Dec. 4, and was at $1,164.50 at 3:20 p.m. in Seoul. The price has gained for six straight days, the longest winning streak since September.
The June-delivery contract in New York rose as much as 0.8% to $1,170.70 an ounce and was last at $1,165.20. Futures rallied 3.2% last week, the most since Feb. 12.
Forced into action by a surge in Greek borrowing costs to an 11-year high, euro-region finance ministers said yesterday they would offer as much as 30 billion euros in three-year loans in 2010 at about 5%. That's less than the current three-year Greek bond yield of 6.98%. Another 15 billion euros would come from the International Monetary Fund.
The euro gained 1.2% to $1.3659 as of 1:31 p.m. in Tokyo and touched $1.3677, the most since March 18.