Gold firms amid fear for eurozone contagion
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Xinhua, November 16, 2011
Gold futures on the COMEX Division of the New York Mercantile Exchange ended a tad higher on Tuesday, as eurozone contagion fears lent some support for the prices of precious metals, but the strength of the greenback against other currency rivals overseas capped the gains.
The most active gold contract for December delivery rose 3.8 dollars, or 0.2 percent, to 1,782.2 dollars per ounce.
The European Union's statistics agency reported Tuesday that third-quarter gross domestic product across the 17-nation currency union expanded by 0.2 percent compared to the second quarter, and grew 1.4 percent over that of a year ago, matching economists' forecast.
Meanwhile, a separate report showed that German investors' confidence fell to a three-year low in November.
A trader mentioned that although some investors had breathed sigh of relief as data showed eurozone economy managed to eke out further gains amid the worsening debt crisis, the fact that Europe 's economic expansion failed to accelerate in the third quarter still added to the concerns about the ability of eurozone leaders to contain the debt crisis.
Market participants mentioned that demand for gold and other safe haven assets such as the U.S. dollar got a boost on Tuesday as concerns over the eurozone debt woes continued to plague world markets, but a stronger U.S Dollar keeps pressuring the precious metals, halting upward momentum.
"Rumor has it that Italy will be in for a significant credit downgrade. These wide choppy ranges (in gold market) are beginning to be the norm. And I expect them to remain until investor confidence grows," said Mike Daly, a gold specialist with PFGbest here in Chicago.
Silver for December delivery jumped 43.2 cents, or 1.3 percent, to 34.456 dollars per ounce. Platinum for January delivery lost 1. 4 dollars, or 0.1 percent, to 1,642.7 dollars per ounce.
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