Gold fell in New York for the third straight day, Silver rose slightly

Gold fell in New York for the third straight day on speculation that a stronger dollar will curb demand for the metal as an alternative asset.

The dollar rose as much as 0.1 percent against a basket of currencies, before paring gains, as a slower-than-expected expansion of France’s gross national product fuelled concern that the European economy is stalling. On Thursday, trading in the most-active gold futures was about 49 percent lower than a week earlier, exchange data compiled by Bloomberg show.

“The dollar’s strength is hurting gold,” Michael Smith, the president of T&K Futures and Options in Port St. Lucie, Florida, said in a telephone interview. “Also, the market is very illiquid as most of the investors are away because of the holiday season.”

Gold futures for February delivery slipped 0.3 percent to settle at $1,606 an ounce at 1:41 p.m. on the Comex in New York. There were 96,547 futures in the contract traded on Thursday, compared with 189,916 a week earlier. The exchange will be closed Dec. 26 in observance of the Christmas holiday.

The price has climbed 13 percent this year, outpacing returns for global equities and Treasuries, based on Merrill Lynch indexes. The metal still is heading for the first quarterly decline in three years as the greenback rose against the euro amid Europe’s escalating debt crisis.

“Gold will prove to be a great buy in January, but investors who want to establish long positions don’t feel the need to do it now,” James Cordier, the founder of Optionsellers.com in Tampa, Florida, said in a telephone interview.

Silver futures for March delivery added 0.1 percent to $29.084 an ounce on the Comex. Still, prices declined 2 percent this week.

On the New York Mercantile Exchange, palladium futures for March delivery gained 1.8 percent to $665.25 an ounce, extending this week’s gain to 6.5 percent. Platinum futures for January delivery rose 0.4 percent to $1,429.50 an ounce. – arabianbusiness.com/

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Posted by admin on Dec 24 2011. Filed under Gold price. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry