Gold fluctuated in London as concern Europe’s debt woes will continue spurred demand for the metal as a protection of wealth. The euro was little changed against the dollar as the European Central Bank will lend banks 149.5 billion euros ($196 billion) for three months to meet their liquidity needs over the year-end period. The cost of insuring Greek debt jumped yesterday after Fitch Ratings warned on Dec. 21 it may cut the nation’s credit rating to non-investment grade. “With downgrade threat set to intensify euro-zone default fears we expect gold to remain underpinned by investment demand for some time to come,” James Moore, an analyst at TheBullionDesk.com in London, said in a report. Immediate-delivery bullion lost 60 cents to $1,384.75 an ounce at 8:53 a.m. in London. Prices gained as much as 0.2 percent and lost as much as 0.1 percent, and reached a record $1,431.25 on Dec. 7. The metal for February delivery was 0.2 percent lower at $1,385 on the Comex in New York. Gold gained 26 percent this year, set for a 10th annual gain, as investors lost confidence in currencies and bought precious metals as a protection of wealth. The ECB said yesterday 270 banks asked for the unlimited funds over 98 days, which will be loaned at its average benchmark interest rate over the period. “The euro-zone still looks uncertain, supporting gold,” Hwang Il Doo, a senior trader at Korea Exchange Bank Futures Co. in Seoul, said today by telephone. “Since many see gold rising further next year, there’s demand to buy on dips, which actually helps keep the metal from falling significantly at yearend.” Gold assets in exchange-traded products fell 9.29 metric tons to 2,104.4 tons yesterday, according to data compiled by Bloomberg from 10 providers. Holdings reached a record 2,114.6 tons on Dec. 20. Silver for immediate delivery in London added 0.1 percent to $29.2575 an ounce. Palladium gained 0.3 percent to $754.20 an ounce. Platinum was 0.3 percent higher at $1,729.90 an ounce. To contact the reporters on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net; Sungwoo Park in Seoul at spark47@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net.

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