Bullion metals add little shine

Prices register marginal rise after Chile is hit with aftershock of last quake

Precious metal prices ended little higher on Thursday, 11 March, 2010. Prices rose after Chile was rocked by an aftershock, which followed the major earthquake that hit the country a fortnight back. Prices also increased following China's economic data.

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 Thursday, gold for April delivery ended at $1,108.2 an ounce, higher by $0.1 (0.01%) an ounce on the New York Mercantile Exchange. Last week, gold gained 1.4%. In FY 2010, gold touched a high of $1,154 in January.

On Thursday, May Comex silver futures ended higher by 14.2 cents (0.8%) at $17.15 an ounce. Last week, silver ended higher by almost 8%.

Gains were limited today, after Chile's mining-giant Codelco, the largest producer of copper in the world, said it found no damage to its Andina and El Teniente operations. Both locations were temporarily shut down after the February quake.

Gold and other metals also advanced after a report from China showed sharper-than-expected increases in consumer and producer prices. That rekindled concern about tighter monetary policy in the country, which many have looked to as a leader in the global economic rebound. China reported that its inflation rate rose to 2.7% in February from 1.5% the prior month.

In the currency market on Thursday, the dollar index, which measures the strength of the dollar against a basket of six other currencies, fell by more than 0.2%.

Gold had ended FY 2009 higher by 24%. Silver futures had ended 2009 up 50%. The dollar index had lost 4.2% against its counterparts last year.