Gold traded little changed near a two-week high as investors weighed concern about slowing global economic growth and expectations for more stimulus. Palladium was near the highest level since September 2011.
Spot gold was at $1,680.05 an ounce at 10:29 a.m. in Singapore from $1,679.95 yesterday. The metal reached $1,685.25 on Jan. 15, the most expensive since Jan. 3, as U.S. lawmakers wrangled over increasing the $16.4 trillion debt ceiling. Since 1960, Congress has raised or revised the debt limit 79 times, including 49 times under Republican presidents, according to the Treasury Department.
Gold gained 7.1 percent in 2012, rallying for a 12th year, as central banks around the world took measures to boost their economies. The Bank of Japan (8301) may introduce new monetary easing measures at a meeting next week. The World Bank on Jan. 15 cut its global growth estimate to 2.4 percent from 3 percent.
“Global economic data remains mixed and uncertainty over the U.S. debt ceiling continues to weigh on investor sentiment,” said Sun Yonggang, a macroeconomic strategist at Everbright Futures Co., a unit of one of China’s largest state- owned investment companies. “Gold is torn between its role as a haven and its association with other risky assets.”
Gold for February delivery fell 0.2 percent to $1,679.60 an ounce on the Comex in New York.
Cash bullion of 99.99 percent purity retreated 0.1 percent to 337.30 yuan a gram ($1,686.16 an ounce) on the Shanghai Gold Exchange. Volumes for benchmark cash contract were 10,496 kilograms (10.5 metric tons) yesterday, more than double the daily average in 2012, according to the bourse’s website and data tracked by Bloomberg.
Cash palladium rose as much as 0.4 percent to $725.25 an ounce before trading at $721.25. The price touched $727.50 yesterday, the costliest since Sept. 19, 2011. Palladium, used in autocatalysts, is expected to outperform platinum as demand outpaces supplies, according to Goldman Sachs Group Inc.
The majority of growth in the global automotive sector is coming from gasoline markets like the U.S. and China, Goldman analysts wrote in a report yesterday. Carmakers typically use more palladium for gasoline engines and more platinum for diesel types. Palladium will continue to substitute platinum in diesel markets and tighter emissions regulations in Europe will see a shift back to gasoline there, the analysts wrote.
Spot platinum slid 0.2 percent to $1,685.75 an ounce, trading above gold for a third day. The metal jumped to a three- month high of $1,701 on Jan. 15 after Anglo American Platinum Ltd. (AMS), the world’s largest producer of the metal, announced plans to reduce jobs and output. Holdings in exchange-traded products reached a record 52.9039 metric tons yesterday, according to data compiled by Bloomberg.
Silver slipped 0.2 percent to $31.415 an ounce. Assets in exchange-traded products expanded to an all-time high of 19,114.93 tons yesterday.
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