Gold lost some ground in Asian markets on Monday, pressured by a lack of direction in major currency markets, but analysts said bullion was starting to look cheap compared with other commodities.
Currency trading has long held sway over bullion prices, with any signs of a weaker US dollar sparking bouts of gold buying outside the United States. "The dollar didn't give us much direction," a bullion dealer said. Gold appeared to be a better buy than some other commodities, given its strong links to currency movements, according to analysts for Deutsche Bank AG.
"We find that the gold price has displayed substantial upside potential as an inflation hedge," Deutsche said in its latest report on commodity markets. "Furthermore, the gold price is trading cheaply with respect to the euro/US dollar and compared to the copper price," Deutsche said.
Spot gold was quoted at $383.85/$384.35 at 0310 GMT versus $384.50/5.25 late on Friday in New York, which was up $6.10 on the day. Bullion was last fixed in London at $385.30 an ounce.
COMEX gold advanced to a two-week high Friday as a weakening in the dollar prompted commodity funds to buy back short positions in precious metals. The yen gained against the dollar on a rise in Japanese stock prices ahead of bank results that were expected to be benign. The dollar was at 112.27/32 yen versus 112.40 in late US trade on Friday. It briefly dipped to around 112 yen.
The euro bought $1.1964/69 versus around 1.1990 in late New York trade. The Australian dollar was consolidating around US $0.70.
In Tokyo gold futures, the benchmark April contract was 14 yen higher at 1,389 yen per gram.
Spot silver was up one cent to $5.84/$5.86 an ounce. Spot platinum was unchanged at $820.00/$825.00. Spot palladium was $1.50 higher at $248.00/$253.00 an ounce.
Comments
Comments are closed.