BLBG: Gold Declines as Rally to Seven-Week High Spurs Investor Sales
Gold declined for the first time in seven days on speculation that a rally to a seven-week high is prompting investors to sell the metal.
Bullion for immediate-delivery decreased as much as 0.4 percent to $1,401.55 an ounce and traded at $1,404.53 at 12:15 p.m. in Singapore. The price earlier rose to $1,410.75 an ounce, the highest level since Jan. 4. Cash silver lost as much as 1.8 percent to $33.2925, reversing an earlier advance to $34.3187, the highest level since 1980.
“The desire to take profits grew among short-term investors after gold’s recent rally,” said Lim Chae Myung, Seoul-based trader with Hyundai Futures Co. “That, coupled with a stronger dollar, is taking some steam out of gold but I don’t believe this is a trend reversal.”
Gold rallied 3.6 percent this week through yesterday, nearing the all-time high of $1,431.25 set in December, as investors bought precious metals to preserve wealth against geopolitical risk and rising inflation. The Dollar Index, a six- currency gauge of the greenback’s value, rose 0.6 percent today. Gold typically moves inversely to the dollar.
Libya erupted into violence last night after leader Muammar Qaddafi’s son threatened “rivers of blood” and deployed security forces against protesters. At least 250 people died in Tripoli alone, al-Jazeera reported, citing witnesses.
Libya is the latest country in the region to be rocked by protests ignited by last month’s ouster of Tunisia’s president and energized by the Feb. 11 fall of the Egyptian president. Rising food and commodity prices have contributed to uprisings in the Middle East.
Gold futures for April delivery in New York gained as much as 1.7 percent to $1,411.50 an ounce and last traded at $1,403.60. Palladium decreased 0.4 percent to $855.15 an ounce, after touching $862.25 yesterday, the highest level since 2001. Platinum for immediate delivery fell 0.4 percent to $1,843.25.
To contact the reporter on this story: Kyoungwha Kim in Singapore at kkim19@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
