Dollar’s decline once again pushes up gold
After slipping for two consecutive days, gold prices rose today as dollar weakened against its rival currencies. Since the past couple of days, drop in crude oil and a continuation of the strengthening of the dollar against other currencies continued to hurt gold's appeal as an inflation hedge.
Comex Gold for December delivery climbed $8.1 (1.1%) to close at $743.8 an ounce on the New York Mercantile Exchange today, Wednesday, 4 October, 2007. It recovered from a low price of $726.5 an ounce. On Monday, 1 October, gold had climbed to an intraday high of $755.7. That was the highest intra day price seen since the last 28 years.
Comex Silver futures for December delivery rose 3 cents (0.2%) to $13.50 an ounce. The metal has climbed 4.4% this year.
The dollar climbed today after erasing its earlier gains against the euro after new orders data for U.S made factory goods showed that it dropped a greater-than expected 3.3% in August, the largest decline in factory orders in seven months. The dollar index, which tracks the performance of the dollar against a basket of currencies, fell 0.2% at 78.40.
In recent times, the weakening of dollar have continued to affect the price of the metal. Investor sentiments are boosted by the fact that gold and silver were alternate sources of good investment in the face of declining dollar and rising energy prices.
Gold prices have jumped 15% during the third quarter and it is the most since 1999. The yellow metal has climbed 17% this year.
As per Nymex data on Wednesday, Gold warehouse inventories rose by 83,102 troy ounces to stand at 7.2 million troy ounces and silver supplies rose to 133.1 million troy ounces, up 294,757 troy ounces.
At the MCX, gold prices for December delivery closed at Rs 9475 per 10 grams. The closing price is Rs 12 (0.12%) lower as against previous closing price. Prices fell to a low of Rs 9319 per 10 grams during the day’s trading.
At the MCX, silver prices for December delivery closed Rs 54 (0.3%) lower at Rs 17,971/Kg. Prices opened at Rs 17,988/kg and went to a low of Rs 17,651/Kg during the day’s trading.