Nov. 28 -- Gold fell for a second day as lower energy costs reduced demand for the metal as a hedge against inflation and expiry-induced volatility in the gold futures market sparked some selling in the cash market. Silver declined.
Gold and oil often move in tandem as investors tend to buy gold when rising energy prices stoke inflation and sell the metal when fuel costs fall. Crude oil in New York declined for a third day on speculation the Organization of Petroleum Exporting Countries will agree to raise output.
Gold is down today because ``energy prices are lower'' and ``selling induced by the volatilities when some traders roll over contracts in the futures market,'' William Kwan, bullion dealer at Phillip Futures in Singapore, said by phone today.
Bullion fell by $5.23, or 0.6 percent, to $807.36 an ounce at 10:52 a.m. Singapore time after trading between $807.10 and $815.40. Silver fell by 0.9 percent to $14.34 an ounce.
``The dollar looks relatively weak still, which is supporting gold,'' said Kwan.
The U.S. Dollar Index traded on the ICE Futures in New York traded at 75.207 today, close to 74.484 reached on Nov. 23, the lowest since the gauge started trading in 1973. The index tracks the value of the dollar against the euro, yen, pound, Canadian dollar, Swedish krona and Swiss franc.
February-delivery gold on the Comex division of the New York Mercantile Exchange fell by 0.9 percent to $814.10 an ounce at 11:08 a.m. Singapore time.
In Japan, the most active gold futures contract fell 56 yen, or 1.9 percent, to 2,857 yen a gram ($819 an ounce) on the Tokyo Commodity Exchange at the 11 a.m. local time break.
``Tokyo gold will track the decline in gold futures in New York,'' said Masaya Ozaki, analyst at DOT Commodity in Tokyo. ``Buy on dips because the yen is falling against the dollar.''
Japanese investors usually buy yen-denominated gold contracts when the dollar is strengthening against the yen.
No comments:
Post a Comment