Gold Recovers From A Low Point

Gold is trading at $1217.60 this morning gaining $2.10 as the US dollar declined. Silver recorded adding 7 points after dropping to its lowest level in 2014 earlier in the week. Silver is trading at $17.263. Platinum also recovered adding $6.60 to climb to $1291.05 but remains near a 5 year low. The gap between platinum and gold prices ended at $74.10, the narrowest in a year. With the US economy steaming ahead while Europe and Asia stall, investors expect the Federal Reserve to raise interest rates next year, a move that makes the US dollar more attractive. The greenback’s rally over the past few months has weighed on gold, which is priced in the US currency and becomes more expensive for foreign buyers as the greenback appreciates. Silver prices, which often trade in tandem with gold, closed up 1.2 per cent, or 20.2 cents, at $17.259 a troy ounce, the biggest one-day percentage gain since July 17.

With prices for the metal down nearly 10 per cent from July highs and hovering just above the psychologically important $1,200 level, some investors who had bet against gold on the way down locked in profits and bought back the metal.Prices also had been given a boost by unprecedented pro-democracy protests in Hong Kong. Some investors buy gold in times of economic or political uncertainty, believing it will hold its value better than other assets.

Gold extended losses on Wednesday to trade near a nine-month low and looked likely to break below the key $1,200-an-ounce level as the dollar gained in strength. The absence of top buyer China, which begins a week long holiday from Wednesday, is also likely to add pressure.

Expectations of an earlier rate hike in the United States have also clobbered gold, a non-interest-bearing asset. Investors were also eyeing political unrest in Hong Kong for its impact on equities, and possibility of safe-haven bids for gold. SPDR Gold Trust, the top gold-backed exchange-traded fund, fell 2.39 tonnes to 769.86 tonnes on Tuesday. Bullion and other precious metals have been weighed down by the strength in the dollar, which is close to a four-year peak against a basket of currencies.

Copper extended gains by 8 points to trade at $3.036 rebounding from a three-month. Copper slipped to its lowest in more than three months on Wednesday, pummeled by a stronger dollar and concerns swelling supply could overwhelm fragile demand growth in top consumer China. Euro zone inflation slowed again in September as some food and energy prices fell. The metal rose as much as 0.4 percent in London. Nonfarm payrolls forecasts forecast that jobs grew by 215,000 workers in September, up from an increase of 142,000 in August, according to a Bloomberg survey of economists before the release due on Friday. ADP figures showed yesterday companies added more than 200,000 workers for a sixth straight month in September.