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Friday, July 16, 2010
Forex Special - US gold futures rose slightly on Thursday as the dollar fell against the euro and US economic indicators failed to live up to expectations.
August gold closed at $1,208.30 per ounce, up $1.30 or 0.11 percent on Wednesday’s closing price of $1,207 on the Comex division of the New York Mercantile Exchange (Nymex). Prices swung from an intraday low of $1,203.70 to a high of $1,217.30.
Gold prices fell early, right after the first set of US data, but then rallied as the dollar sank below 1.29 against the euro for the first time since May. The greenback dropped as low as 1.2953 against the euro and later settled around 1.2945.
The euro got a helping hand from a successful Spanish bond sale, following similar Portuguese, Greek, German and Italian auctions, while the Italian government also passed its austerity package through parliament.
"The dollar broke support," said a trader in New York. "For awhile, gold was moving with the dollar because both were viewed as safe havens. Both gold and the dollar moved opposite the euro, but now that seems to be changing."
US economic data roundly disappointed the market, even after the US Federal Reserve yesterday reduced its growth forecast for the current year by 0.2 percentage points to somewhere between 3 percent and 3.5 percent.
The Philly Fed Manufacturing Index, a measure of regional growth, came in at 5.1, well short of the 10.2 expected, and the Empire State Manufacturing Index came in at 5.1, far below an expected 18.3. The June PPI shrank 0.5 percent on the previous month, larger than the forecast 0.2-percent fall.
In other precious metals, September silver gained 7.2 cents or 0.4 percent to close at $18.362 per ounce on the Comex, while October platinum rose $13.10 or 0.9 percent to close at $1,533.70 per ounce and September palladium went up $1.40 or 0.3 percent to close at $467.20 per ounce on the Nymex.