• Home
• /
• Business

Gold rises 1 pct on firm oil, soft US dollar

SINGAPORE - Gold rose as much as 1 percent on Thursday on safe-haven buying as oil continued its ascent and on a sliding dollar, but it would have to crack key resistance levels to sustain the uptrend.

‘Gold is still capped by the big resistance at $837, and above at $846. I don't think much would happen ahead of the US long holiday weekend,’ said Peter Tse, a dealer at Scotia Mocatta in Hong Kong, referring to Monday's Labor Day holiday.

Physical buying ahead of the festive season in Asia has helped gold rebound more than 7 percent since tumbling to nine-month lows around $773 an ounce in mid-August.

Gold firmed to $832.60/833.60 an ounce from $826.05/827.45 an ounce late in New York on Wednesday, having hit an intraday high of $834.35 an ounce.

Oil rose for a fourth straight day to stay above $118 a barrel on Thursday, on fears Tropical Storm Gustav may hit the Gulf of Mexico after it morphs into a major hurricane, paralysing the heart of US offshore production.

‘Perhaps oil could lead gold higher here, and on the oil side, I think Gustav is something we should watch. For the dollar, we will probably have to focus on tonight's US GDP data for direction,’ said Adrian Koh, an analyst at Phillip Futures in Singapore.

The euro edged up to $1.4781 recovering from a six-month low of $1.4570 hit on Tuesday, after comments by a European Central Bank official the previous day scaled back speculation about an ECB rate cut.

Spot platinum rose to $1,436.00/1,456.00 an ounce from $1,434.00/1,454.00 late in New York.

‘Platinum seems to be edging higher, but I don't think we are clearly out of the downside yet. If platinum can clear the $1,450 level and perhaps make a move to the $1,500 level, then that scenario may change a little,’ said Koh of Phillip Futures.

Higher gold prices spurred speculative buying in platinum but investors remained cautious after the metal sank to an 11-month low around $1,296 last week.

Automakers were also on the sidelines. A slowing US economy and poor car sales have sparked worries about falling demand for autocatalysts, which account for more than 50 percent of global platinum use. The metal was well below a lifetime high of $2,290 hit in early March.

Toyota Motor Corp said it would miss its goal of selling more than 10 million vehicles next year, cutting its forecast by nearly 7 percent due to a downturn in western markets driven by high fuel prices and a credit crunch.Spot palladium inched up to $290.50/295.50 an ounce from $288.50/296.50 an ounce. Silver firmed to $13.61/13.67 an ounce from $13.49/13.55 an ounce late in New York.

The new benchmark contract on the Tokyo Commodity Exchange, August 2009 rose 9 yen per gram to 2,939 yen per gram.

New York gold futures added $3.2 an ounce to $837.20.

Precious metals prices at 0542 GMT

MetalLastChange Pct chg YTD pct chg Turnover

Spot Gold831.956.05+0.73-0.09

Spot Silver13.590.16+1.19-7.99

Spot Platinum1436.002.50+0.17-5.53

Spot Palladium290.001.50+0.52-21.20

TOCOM Gold2937.007.00+0.24-4.02 23683

TOCOM Platinum5037.0037.00+0.74-5.66 11747

TOCOM Silver483.00-2.60-0.54-10.72 796

TOCOM Palladium 1035.00 -13.00-1.24-23.39 559

Euro/Dollar1.4781

Dollar/Yen109.02

TOCOM prices in yen per gram, except TOCOM silver which is priced in yen per 10 grams. Spot prices in $ per ounce.