February 12, 2015 / 3:55 AM / 5 years ago

PRECIOUS-Gold ticks up from 5-wk low as Greek debt drama unfolds

* Gold edges up after 1 pct loss overnight
    * Greek debt talks to continue on Monday
    * US dollar, possible rate hike hampering gains in gold -

 (Updates prices)
    By A. Ananthalakshmi
    SINGAPORE, Feb 12 (Reuters) - Gold edged higher on Thursday,
after earlier dropping to a five-week low, as confusion over
Greece's debt negotiations with its European lenders dominated
markets, drumming up some safe-haven bids for the metal.
    Spot gold fell to $1,216.45 per ounce, its lowest
since Jan. 9, before recovering to trade up 0.3 percent at
$1,222.30 by 0745 GMT.
    The metal lost 1.2 percent on Wednesday as the dollar 
hit a three-week peak against a basket of major currencies on
weakness in the euro and the yen. 
    "We continue to see a conflicted gold market with the market
split between bears and bulls as the U.S. dollar strength
improves against global economic issues and safe-haven demand,"
said ANZ analyst Victor Thianpiriya. 
    Gold, seen as a safe-haven asset, tends to get a boost
during times of economic and geopolitical uncertainty.
    Financial markets are under pressure as euro zone finance
ministers were unable to agree with Greece a final statement or
a way to continue talks until their next meeting on Monday,
following hours of discussions in Brussels to extend an
international bailout.
    Greek Finance Minister Yanis Varoufakis played down a
failure to reach a common position with the rest of the euro
zone and said he believed a "healing deal" on Greece's finances
could be reached on Monday. 
    The uncertainty knocked down Asian stocks and the euro on
Thursday as markets feared that Greece could exit the euro zone
if it fails to reach a deal. 
    Gold's sell-off for much of this week despite the Greek
issue suggests that markets are either expecting an ultimately
positive result, or they may be discounting the country's
possible exit as a net positive, said INTL FCStone analyst
Edward Meir.
    "We also have to suspect that with a Federal Reserve rate
increase in the offing and U.S. equity markets looking much
steadier, gold is finding it difficult to gain traction on the
upside," Meir said.
    The Fed should raise interest rates in June, a top Fed
official said earlier this week, saying the U.S. economy was
strengthening and inflation would move back to the central
bank's target. 
    Any hike by the Fed, which has kept rates near zero since
2008 to stimulate the U.S. economy, could further strengthen the
dollar and in turn hurt demand for bullion, a
non-interest-bearing asset.

    PRICES AT 0745 GMT  
 Metal           Last     Change  Pct chg
 Spot gold        1222.3    3.64      0.3
 Spot silver       16.69   -0.07    -0.42
 Spot platinum   1193.85    3.25     0.27
 Spot palladium    768.5     3.1     0.41
 Comex gold       1222.4     2.8     0.23
 Comex silver      16.71  -0.051     -0.3
 Euro             1.1331                 
 DXY              94.809                 
 COMEX gold and silver contracts show the
 most active months
 (Reporting by A. Ananthalakshmi; Editing by Joseph Radford,
Richard Pullin and Gopakumar Warrier)
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below