Precious metals rise

Gold makes small advances while silver ends modestly higher

Precious metals ended with advances on Monday, 14 February 2011 at Comex. Gold made small advances while silver registered modest gains. Both metals rallied to their best levels in late morning trade but spent the remainder of the session trading sideways below their respective highs.



On Monday, gold for April delivery ended higher by $4.7 (0.4%) at $1,365.1 mark on the New York Mercantile Exchange. Last week, gold ended higher by 0.8%. For the year, gold has dropped by 4% till date.

For the year of 2010, gold ended higher by 30%, its tenth consecutive yearly gain.

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.

On Monday, March Comex silver futures ended higher by $0.54 (1.8%) at $30.53. Prices gained 4.4% last week. Prices have shed 9% this year in January. For the year till date, silver has shed 0.5%.

In FY 2010, silver ended higher by 83.7%.

Last Friday, news came out that Egypt's President Hosni Mubarak has finally decided to step down. The military is trying to restore back some normalcy in the country. The same also reduced the volatility in prices among precious metals.

Bullion metal prices are expected to continue with their joyride in the coming months with gold expected to reach between $1,600 and $1,700 an ounce and silver likely to attempt to test highs in the $50 area.

At the MCX, gold prices for April delivery closed higher by Rs 30 (0.15%) at Rs 20,370 per ten grams. Prices rose to a high of Rs 20,404 per 10 grams and fell to a low of Rs 20,282 per 10 grams during the day's trading.

At the MCX, silver prices for March delivery closed Rs 675 (1.5%) higher