Precious metals gather some shine

Prices rise by more than 1% as dollar coughs up early gains

Precious metal prices rose on Monday, 13 July, 2009. Prices rose as the dollar pared earlier gains. Prices rose in spite of crude prices slipping further lower.

Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.

On Monday, gold for August delivery ended at $922.5, higher by $10 (1.1%) an ounce on the New York Mercantile Exchange. Last week, gold ended lower by 1.6%. Year to date, gold prices are higher by 4.5%.

For the month of June, 2009, gold ended down by 5.4%. Gold had ended the month of May higher by 9.8%. It was the highest monthly gain registered by gold in six months. For the second quarter, gold ended higher by 0.5%. The metal had gained 4.3% in the first quarter of this year.

On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped somewhat (11%) since then.

On Monday, Comex silver futures for September delivery rose 14 cents (1.1%) at $12.785 an ounce.

Silver ended 13% down for the month of June, 2009. For the month of May, silver gained 26.6%. It was the biggest monthly gain for silver in more than two decades. For second quarter, silver rose 4.5%. Year to date, silver has climbed 13.9% this year. For 2008, silver had lost 24%.

In the currency market on Monday, the dollar fell against the euro, with the European currency trading up 0.3%.

In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.

At the MCX, gold prices for August delivery closed higher by Rs 96 (0.66%) at Rs 14,596 per 10 grams. Prices rose to a high of Rs 14,625 per 10 grams and fell to a low of Rs 14,505 per 10 grams during the day's trading.

At the MCX, silver prices for September delivery closed Rs 135 (0.63%) higher at Rs 21,398/Kg. Prices opened at Rs 21,299/kg and rose to a high of Rs 21,446/Kg during the day's trading.