Nov. 11 (Bloomberg) -- Gold futures rose, capping the third straight weekly gain, as a decline in the dollar revived demand for the precious metal as an alternative asset.
The greenback fell as much as 1.3 percent against a basket of six major currencies. Italy’s Senate approved a key budget bill today, paving the way for a new government led by former European Union Competition Commissioner Mario Monti, while Greece will swear in Lucas Papademos to head a unity government. On Nov. 8, gold reached a seven-week high of $1,804.40 an ounce.
“The weaker dollar is providing some support to gold,” William O’Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey, said in a telephone interview. “Also, the long-term fundamentals remain.”
Gold futures for December delivery gained 1.6 percent to close at $1,788.10 at 1:45 p.m. on the Comex in New York. This week, the price climbed 1.8 percent.
The metal has climbed 26 percent this year, reaching a record $1,923.70 on Sept. 6, as investors sought to diversify away from equities and some currencies amid fiscal turmoil in Europe and the U.S.
“The European sovereign crisis is not going away,” Edel Tully, an analyst at UBS AG in London, said in a report. “The likelihood of recession in Europe next year, a global growth shortfall, and uncertainties surrounding monetary and fiscal policies generally help gold’s cause. But they also add much volatility.”
Silver futures for December delivery rose 1.7 percent to $34.682 an ounce in New York. The price climbed 1.8 percent this week. The metal has advanced 27 percent in the past 12 months.
On the New York Mercantile Exchange, platinum futures for January delivery rose 1.2 percent to $1,646.70 an ounce. Palladium futures for December delivery climbed 2.3 percent to $662.80 an ounce.
--With assistance from Yi Tian in New York. Editors: Patrick McKiernan, Steve Stroth
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