The dollar gained for a second day against the euro before data that may show investor confidence in Germany is near the lowest level in 21 months. Gold, which reached a record $1,387.35 an ounce on Oct. 14, usually moves inversely to the greenback. The U.S. currency slipped to an eight-month low on Oct. 15 after Federal Reserve Chairman Ben S. Bernanke said additional monetary stimulus may be warranted.
“The dollar looks set to provide further direction in the coming sessions as players speculate over the Fed’s quantitative easing measures,” said James Moore, an analyst at TheBullionDesk.com in London. Precious metals “would benefit from a period of consolidation, however gold should remain underpinned by dip-buying interest from the physical and investment sector.”
Immediate-delivery bullion lost $10.38, or 0.8 percent, to $1,358.02 an ounce at 9:01 a.m. in London. Gold for December delivery was 1 percent lower at $1,358.50 an ounce on the Comex in New York. Futures reached a record $1,388.10 on Oct. 14.
Gold, up 24 percent this year, is heading for a 10th annual gain, the longest winning streak since at least 1920. Bullion has outperformed global equities, Treasuries and most industrial metals, prompting record investment in gold-backed exchange- traded products. The metal rallied as central banks and governments maintained low borrowing costs and spent trillions of dollars to stimulate economies.
Stimulate Economy
Bernanke last week said he and his colleagues are considering ways they can stimulate the economy and that additional monetary stimulus may be warranted because inflation is too low and unemployment is too high. Fed policy makers next meet on Nov. 2-3.
“For the time being we are just waiting for more significant data and further rhetoric from the Fed,” Darren Heathcote, head of trading at Investec Bank (Australia) Ltd., said today by phone from Sydney. “Gold is off the peak, but you are bound to get some profit-taking,” he said.
A German report tomorrow may show investor confidence dropped for a sixth month in October, adding to signs the 16- nation euro region’s recovery may be slowing, according to a Bloomberg News survey of economists.
China is forecast to increase gold production to 340 metric tons this year, Zhang Fengkui, section chief of the raw materials department at the Ministry of Industry and Information Technology, said on Oct. 16 at a conference, without providing the scale of the increase. China’s gold output last year reached 314 tons, the China Gold Association said in January.
ETP Holdings Decline
Gold assets in ETPs declined 1.99 tons to 2,102.66 tons on Oct. 15, according to data compiled by Bloomberg from 10 providers. Holdings are up 17 percent this year and reached a record 2,104.65 tons on Oct. 14. Silver assets rose 24.79 tons to 14,207.35 tons on Oct. 15, the highest amount in at least eight months, data compiled by Bloomberg from four providers show.
Silver for immediate delivery in London dropped 2.3 percent to $23.77 an ounce. The metal reached $24.92 on Oct. 14, the highest level since March 1980.
Silver may trade between $20.50 and $25.50 for the rest of this year and average $19.30 an ounce in 2010, Philip Klapwijk, chairman of London-based research company GFMS Ltd., said at a conference in Beijing on Oct. 16. The metal has averaged about $18.39 so far this year.
“Our view is silver is likely nearing a top now, and that it has more downside in the short term than upside,” Klapwijk said. “But we remain bullish in the long term.”
Platinum declined 1.3 percent to $1,672.75 an ounce. Palladium fell 3.7 percent to $568 an ounce after reaching $605.13 on Oct. 14, the highest price since June 2001.
“The dollar looks set to provide further direction in the coming sessions as players speculate over the Fed’s quantitative easing measures,” said James Moore, an analyst at TheBullionDesk.com in London. Precious metals “would benefit from a period of consolidation, however gold should remain underpinned by dip-buying interest from the physical and investment sector.”
Immediate-delivery bullion lost $10.38, or 0.8 percent, to $1,358.02 an ounce at 9:01 a.m. in London. Gold for December delivery was 1 percent lower at $1,358.50 an ounce on the Comex in New York. Futures reached a record $1,388.10 on Oct. 14.
Gold, up 24 percent this year, is heading for a 10th annual gain, the longest winning streak since at least 1920. Bullion has outperformed global equities, Treasuries and most industrial metals, prompting record investment in gold-backed exchange- traded products. The metal rallied as central banks and governments maintained low borrowing costs and spent trillions of dollars to stimulate economies.
Stimulate Economy
Bernanke last week said he and his colleagues are considering ways they can stimulate the economy and that additional monetary stimulus may be warranted because inflation is too low and unemployment is too high. Fed policy makers next meet on Nov. 2-3.
“For the time being we are just waiting for more significant data and further rhetoric from the Fed,” Darren Heathcote, head of trading at Investec Bank (Australia) Ltd., said today by phone from Sydney. “Gold is off the peak, but you are bound to get some profit-taking,” he said.
A German report tomorrow may show investor confidence dropped for a sixth month in October, adding to signs the 16- nation euro region’s recovery may be slowing, according to a Bloomberg News survey of economists.
China is forecast to increase gold production to 340 metric tons this year, Zhang Fengkui, section chief of the raw materials department at the Ministry of Industry and Information Technology, said on Oct. 16 at a conference, without providing the scale of the increase. China’s gold output last year reached 314 tons, the China Gold Association said in January.
ETP Holdings Decline
Gold assets in ETPs declined 1.99 tons to 2,102.66 tons on Oct. 15, according to data compiled by Bloomberg from 10 providers. Holdings are up 17 percent this year and reached a record 2,104.65 tons on Oct. 14. Silver assets rose 24.79 tons to 14,207.35 tons on Oct. 15, the highest amount in at least eight months, data compiled by Bloomberg from four providers show.
Silver for immediate delivery in London dropped 2.3 percent to $23.77 an ounce. The metal reached $24.92 on Oct. 14, the highest level since March 1980.
Silver may trade between $20.50 and $25.50 for the rest of this year and average $19.30 an ounce in 2010, Philip Klapwijk, chairman of London-based research company GFMS Ltd., said at a conference in Beijing on Oct. 16. The metal has averaged about $18.39 so far this year.
“Our view is silver is likely nearing a top now, and that it has more downside in the short term than upside,” Klapwijk said. “But we remain bullish in the long term.”
Platinum declined 1.3 percent to $1,672.75 an ounce. Palladium fell 3.7 percent to $568 an ounce after reaching $605.13 on Oct. 14, the highest price since June 2001.
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