Bullions rise for first time in three days

Prices rise as investors seek the perceived safety of the metal

Precious metals ended higher for first time in three days on Friday, 16 September 2011 at Comex. Precious metals rose as investors sought the perceived safety of the metal and the potential for bad news from Europe and elsewhere.

Gold for December delivery rose $33.3 or 1.9%, to end at $1,814.7 an ounce on the Comex division of the New York Mercantile Exchange on Friday. Prices fell to a low of $1,765.4 and rose to a high of $1,825 an ounce during intra day trading. For the week, gold lost 2.4%. It rose by $201 or 12% during the month of August.



On Friday, silver prices for December delivery rose $1.33 (3.4%) to end at $40.83. For the week, silver lost 1.9%. For the month of August, silver gained 4.1%.

Earlier Friday, U.S. Treasury Secretary Timothy Geithner urged euro-zone finance ministers and the European Central Bank to show unity to solve the region's debt crisis and enhance the euro zone's rescue fund.

Meanwhile, Germany's government delayed cabinet discussions on the European stability fund, making it unlikely legislation concerning the fund would be enacted before the end of the year. Also according to reports, the Institute for International Finance is hatching a plan to involve emerging markets and the International Monetary Fund into Greece's debt refinancing.

At home, data showed that a gauge of consumer sentiment rose to 57.8 in the preliminary reading for September after tumbling to a nearly three-year low 55.7 in August. This was as per reports from Thomson Reuters/University of Michigan. Market had expected a slight rise to 57.3. The bigger-than-expected rise dulled some investor interest in the dollar.

In the currency market on Friday, the dollar index, which measures the strength of the dollar against a basket of six other currencies, rose by 0.4%. The dollar index declined about 0.7% during the week, and 3.1% so far in 2011.

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. But bullion metals have registered increase in prices despite strong dollar in recent times and vice versa.