The defeats are a jolt to a full-strength Pakistan side in their preparations for the Twenty20 World Cup
The euro traded close to its lowest against the dollar since late January after the leader of Greece’s Left Coalition party said Athens’ commitment to the EU/IMF financing deal had been rendered void after voters rejected pro-bailout parties in Sunday’s general election.
Growth-linked assets such as European equities and industrial commodities including crude oil, copper and palladium came under pressure as investors bought the dollar as a means of reducing risk, especially in light of recent U.S. data that suggests recovery is taking hold in the world’s largest economy.
Spot gold was down 1.7 percent on the day at $1,611.00 an ounce by 1342 GMT. The price fell last week for a second consecutive week, losing nearly 0.9 percent.
Data showing a sharp jump in exports of gold in March from Hong Kong to mainland China, soon to be the world’s top bullion consumer, did little to support the price but did reinforce analysts’ expectations for gold to benefit in the longer term from Chinese demand.
Gold priced in euros was down around 1.2 percent on the day at 1,238.76 euros ($1,600) an ounce. So far this month, euro-priced gold has outperformed the dollar-equivalent, with a decline of just 0.6 percent compared with a fall of more than 2 percent in benchmark dollar-denominated gold.
“What we’ve seen in recent weeks is rallies have been increasingly weaker on the upside, and that is a warning that we are going to see another test on the downside,” Daniel Smith, an analyst at Standard Chartered, said.
“Gold didn’t benefit from the latest European problems and part of that is the U.S., which has been outperforming relatively speaking, so that is handing the dollar strength.”
In Greece, Leftist party leader Alexis Tsipras said he would not cooperate with the country’s two main parties, the conservative New Democracy and the socialist PASOK, unless they renege on pledges they made to stick to an EU/IMF bailout deal.
The Left Coalition has been given a three-day window to try and form a coalition government after New Democracy, which captured the largest vote share at Sunday’s election, failed to make headway.
This left the euro below $1.30 and near its lowest in nearly four months. The single European currency also came under pressure from concern over how far new French Socialist leader Francois Hollande can change Europe’s policy focus from austerity to restoring growth.
The correlation between the euro and the gold price hit its highest in four months in late April and has since softened but still implies the two are more likely to move in lockstep with each other than in opposite directions.
On the supportive front for gold, Hong Kong’s gold shipments to mainland China in March jumped nearly 59 percent from the previous month to the third-highest level on record, while the gold flow from China surged to the most in at least two years.
Hong Kong shipped 62,907 kilograms of gold to mainland China in March and received 24,835 kg of gold from the mainland, leaving the net exports at 38,072 kg, up 16 percent from February, data from the Hong Kong Census and Statistics Department showed.
“Rising prosperity levels among the population coupled with tighter laws governing property speculation are likely to contribute to sustained high demand for gold in China,” Commerzbank analysts said in a note.
“Above all, Chinese gold demand should lend key support to the price of gold during the course of the year,” they said.
With the euro under pressure, the other precious metals also fell. Silver, which is on course for a third consecutive monthly decline, was down 2.0 percent on the day at $29.41 an ounce.
The silver price has lost more than 13 percent in the last three months, dragged lower by the decline in the gold price, rising production, near-record inventory levels on the U.S. futures exchange and an uncertain demand outlook.
Platinum was last down 0.6 percent on the day at $1,512.24 an ounce, while palladium was down 1.6 percent at $631.08 an ounce, in line with the decline in the euro, which weighed on other industrial, dollar-denominated commodities, such as crude oil and copper.
The defeats are a jolt to a full-strength Pakistan side in their preparations for the Twenty20 World Cup
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