Gold steady near 6-week high, TOCOM aids

SINGAPORE : Gold held steady on Tuesday as gains on Tokyo futures helped the metal defy pressure from a weak euro afte

Published January 24, 2012 Updated January 24, 2012 05:44am

2 min

By Shoaib Ur Rehman

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FUNDAMENTALS

Spot gold hardly moved at $1,676.79 an ounce by 0026 GMT, having risen to $1,681.16 on Monday, its strongest since December 12 on technical buying.

The most active gold contract on the Tokyo Commodity Exchange (TOCOM) , December, rose as high as 4,167 yen a gram, its biggest gain since mid-December.

Central bank gold purchases are expected to have hit another record in 2011, while demand for gold-backed exchange-traded products fell to less than half of that seen in 2010 last year, according to a report from the World Gold Council on Monday.

Holdings of the largest gold-backed exchange-traded-fund (ETF), New York's SPDR Gold Trust, slipped about 0.41 percent on Monday from Friday, while that of the largest silver-backed ETF, New York's iShares Silver Trust remained unchanged in the same period.

Euro zone finance ministers have rejected an offer made by private bondholders to help restructure Greece's debts, euro zone officials said on Monday, sending negotiators back to the drawing board and raising the threat of default.

The US Federal Reserve could take the historic step this week of announcing an explicit target for inflation, a move that would fulfill a multi-year quest of the central bank's chairman, Ben Bernanke.

US gold barely changed at $1,678.2 an ounce.

MARKET NEWS:

The euro retreated from a three-week peak against the dollar in Asia on Tuesday and looked vulnerable to extending its pullback after talks to reduce Greece's debt burden suffered a setback.

Japan's Nikkei average edged up on Tuesday with investors remaining hopeful that a Greek debt deal can still be reached even after European finance ministers rejected an offer by Greece's private creditors.

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