Gold heads for weekly loss as haven demand drops on U.S. data
By Bloomberg
Gold headed for a weekly loss after two days of declines as economic data from the U.S. strengthened the case for a recovery, curbing haven demand. Palladium was set for the biggest weekly rise in seven months.
Bullion for immediate delivery traded at $1,232.01 an ounce at 2:30 p.m. in Singapore from $1,231.84 yesterday, according to Bloomberg generic pricing. Prices are 0.5 percent lower this week after retreating to $1,226.43 yesterday, the lowest level since Oct. 15. A third day of losses for bullion today would be the longest run of declines this month.
The four-week average of U.S. jobless claims fell to the lowest since May 2000, while the Bloomberg Consumer Comfort Index's measure on the state of the economy rose last week, data showed yesterday, boosting the dollar. Assets in the SPDR Gold Trust, the biggest gold-backed exchange-traded product, dropped to lowest since November 2008 this week.
"Gold prices weakened as positive economic data hurt investor demand," Australia & New Zealand Banking Group Ltd. said in an e-mailed report today. "The combination of a stronger U.S. dollar and higher bond yields has seen ETF holdings slump to a five-year low," the bank said, using the initials for exchange-traded fund.
Assets in the SPDR Gold Trust fell to 749.87 metric tons on Oct. 22, the lowest level since November 2008, and held at that level yesterday, according to data compiled by Bloomberg. The Bloomberg Dollar Spot Index, which tracks the currency against 10 major counterparts, is 0.5 percent higher this week.
Overseas Economies
Gold rebounded from this year's low of $1,183.24 on Oct. 6 after the Federal Reserve cited slowing overseas economies as a risk to the U.S. Euro-area manufacturing unexpectedly strengthened in October and a Chinese factory gauge rose at a faster-than-projected rate, data yesterday also showed.
Gold for December delivery rose 0.3 percent to $1,232.20 on the Comex, trimming a weekly decline to 0.6 percent.
Silver for immediate delivery rose 0.3 percent to $17.2538 an ounce and was little changed for the week. Platinum was at $1,256.20 an ounce from $1,256, heading for a weekly drop.
Palladium rose as much as 0.8 percent to $786 an ounce, the highest level since Oct. 15, and was at $785.75. The metal is 4.1 percent higher this week, the biggest gain since March.