Bloomberg News

Gold Futures Decline From Three-Month High on Stronger Dollar

August 28, 2013

Gold Climbs to Highest Since May as Syria Tensions Spur Demand

U.S., France and Britain are moving closer to retaliatory military action against Syria, laying out the justification, putting forces into place and rounding up allies in the region. Photographer: Dan Kitwood/Getty Images

Gold declined from a three-month high in New York as a stronger dollar crimped demand for the precious metal as an alternative investment.

The Bloomberg Dollar Index, a gauge against 10 major currencies, rose as much as 0.5 percent. Gold prices have fallen 15 percent this year as the greenback climbed 4.3 percent. Earlier, prices rose to the highest since May on mounting speculation that there will be an American-led attack on Syria, boosting the appeal of haven assets.

“The dollar strength is working against gold,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “The market is taking a pause after the sharp rally.”

Gold futures for December delivery fell 0.1 percent to settle at $1,418.80 an ounce at 1:38 p.m. on Comex in New York, after touching $1,434, the highest since May 14.

Surging demand for jewelry, coins and bars in Asia helped prices rally 20 percent from a 34-month low of $1,179.40 reached on June 28. Bullion is still heading for the first annual drop in 13 years after some investors lost faith in the metal as a store of value. The rout spurred at least $26 billion of writedowns in the mining industry and losses for John Paulson, the billionaire hedge-fund manager.

Silver futures for December delivery fell 1.1 percent to $24.439 an ounce, after reaching $25.16, the highest since April 15. Trading was more than double the average for the past 100 days at this time of day, data compiled by Bloomberg

Platinum futures for October delivery rose 0.5 percent to $1,540.10 an ounce on the New York Mercantile Exchange. Palladium futures for December delivery fell 0.4 percent to $748.25 an ounce on the Nymex.

To contact the reporters on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net; Debarati Roy in New York at droy5@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net


Toyota's Hydrogen Man
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus