Bullions register modest weekly losses

Delays on Greece's second bailout reduce their appeal

Bullion metal prices ended lower on Friday, 10 February 2012 at Comex. Both gold and silver prices fell as US dollar headed up rose. Delays on Greece's second bailout dented overall sentiment in the market thereby reducing the appeal of precious metals. The drop in prices also came as China's trade surplus for January widened more than expected because of a sharp decrease in imports.

Gold for April delivery ended lower by $15.9 or 0.9%, to end at $1,725.3 an ounce on the Comex division of the New York Mercantile Exchange on Friday. For the week, gold lost 0.9%.



Gold ended the month of January higher by 11%. For the year 2011, gold rose 10%.

On Friday, silver prices for March delivery ended lower by 31 cents or 0.9% at $33.61. For the week, silver shed 0.4%. For the month of January, silver gained 19%. For the year 2011, silver shed almost 11%.

In the currency market on Friday, the Dollar Index, which weighs the strength of dollar against basket of six other currencies rose by almost 0.58%.

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 bullions have registered increase in prices despite strong dollar in recent times and vice versa.

Doubts surfaced on Friday about the deal Greece struck with political parties as European finance ministers demanded a vote on the agreed-upon austerity measures before shipping off any more financial aid to Athens.

Among economic data expected for the day at Wall Street, The Commerce Department in US reported that trade deficit widened in December to a six-month high, as the pickup in the U.S. economy attracted more imported goods. The nation's trade deficit expanded 3.7% in the final month of 2011, to $48.8 billion, the largest since June from a revised $47.1 billion in November.

Another report showed that consumers turned more pessimistic in December, however. A preliminary report from the University of Michigan/Thomson Reuters showed a decline in consumer sentiment to 72.5 in February from a final reading of 75 in January.

At the end of regular trading on Thursday, CME Group said it would reduce the amount of collateral that traders must provide to trade commodities including gold, copper and crude oil. The margin required to open a position in gold futures was cut 12% to $10,125.