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4 years ago
PRECIOUS-Gold eases after four-day rally, firm dollar hurts
July 24, 2013 / 4:55 AM / 4 years ago

PRECIOUS-Gold eases after four-day rally, firm dollar hurts

* Gold eases from one-month high on profit taking
    * Dollar strong, China PMI data weak 
    * Hong Kong premiums stable

 (Updates prices)
    By A. Ananthalakshmi
    SINGAPORE, July 24 (Reuters) - Gold slipped on Wednesday as
investors took profits after a sharp four-day rally pushed
prices up to a one-month top in the previous session, while a
firm U.S. dollar also hurt sentiment.
    Bullion added nearly 6 percent in the past four sessions --
biggest such rise since October 2011 -- as receding worries of
an imminent cut to the U.S. Federal Reserve's stimulus burnished
the precious metal's appeal as a hedge against inflation.
    The Fed has said it will only start phasing out its stimulus
once it is sure the economy is strong enough to stand on its
    Spot gold dropped 0.5 percent to $1,341.16 an ounce
by 0655 GMT, after rising to a one-month peak on Tuesday as
speculators bought back bearish bets ahead of an option expiry
later this week.
    "The selling interest is prompted by profit taking," said
Peter Fung, head of dealing at Hong Kong's Wing Fung Precious
Metals. "Prices could range between $1,330 and $1,350 today."
    Weak data from China dragged on sentiment across financial
markets, while a U.S. dollar recovery hurt assets priced in the
greenback by making them more expensive for holders of other
    Activity in China's manufacturing sector slowed to an
11-month low in July, a preliminary survey showed, suggesting
the world's No.2 economy is still losing
    "Prices are far off from the next level of resistance at
$1,370, and we expect the positive momentum to taper today,"
Phillip Futures analysts wrote in a note.
    Comex gold gained about $6 to $1,341.00, after a
small decline in the previous session. Silver, platinum
 and palladium tracked gold lower.
    Dealers say physical demand has largely held up. 
    "We thought demand would drop as prices rose, but looks like
consumers like the price stability," said one dealer in
    Premiums in Hong Kong, a key supplier to China, were stable
at $5 an ounce to London spot prices, Fung said.
    Demand in top buyer India, however, is expected to be slow
as the government implements new rules to curb imports and
reduce its current account deficit. 
    SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, said its holdings fell 0.16 percent to
929.76 tonnes on Tuesday. 
  Precious metals prices 0655 GMT
  Metal             Last    Change  Pct chg  YTD pct chg    Volume
  Spot Gold        1341.16   -6.33   -0.47    -19.91
  Spot Silver        20.35   -0.10   -0.49    -32.79
  Spot Platinum    1437.99   -9.51   -0.66     -6.32
  Spot Palladium    734.97   -4.03   -0.55      6.21
  COMEX GOLD AUG3  1341.00    6.30   +0.47    -19.98        21203
  COMEX SILVER SEP3  20.34    0.08   +0.40    -32.90         5931
  Euro/Dollar       1.3201
  Dollar/Yen         99.81
  COMEX gold and silver contracts show the most active months
 (Editing by Himani Sarkar and Michael Perry)

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