GO
Loading...

Gold Settles Higher on Dollar Slide, Weak US Data

Monday, 3 Jun 2013 | 3:40 PM ET
AP

Gold settled more than 1 percent higher on Monday, after earlier hitting its highest in more than two weeks, boosted by a tumbling dollar and disappointing U.S. manufacturing data.

The precious metal climbed and U.S. equities fell after data showed the U.S. manufacturing sector contracted in May for the first time in six months.

Gold and other dollar-denominated commodities gained across the board after the U.S. dollar index dropped 1 percent against six major currencies.

(Read More: Dig Gold? Here's Why You Might Be Up Later This Year)

"It's a currency move," said Bill O'Neill, partner of commodities investment firm LOGIC Advisors.

Spot gold was last up 1.9 percent to $1,411 an ounce, having hit a session high of $1,416.11, its highest since May 15. U.S. gold futures rose $18.90 to settle at $1,411.90 an ounce.

(Read More: 3 Gold Mining Stock Bargains)

Analysts also cited short-covering. On Friday, bullion fell almost 2 percent, its steepest daily decline in about two weeks. U.S. economic data will remain in focus this week, as Friday's non-farm payroll data will provide investors with more clues about how long the Federal Reserve will keep U.S. stimulus measures in place.

Strong physical demand appears to keep underpinning gold, with India imported a much higher-than-expected 162 tonnes of gold in May.

Declines in the holdings of SPDR Gold Trust, the world's largest gold-backed exchange traded fund, have stopped after nearly three weeks. Holdings rose last Wednesday and have been unchanged since.

Silver jumped 2.5 percent to nearly $23 an ounce on gold's rally. Platinum rose sharply on supply worries after news of a fatal shooting at Lonmin platinum mine in top producer South Africa. Platinum jumped 2.8 percent last to $1,496 an ounce, while palladium rose 0.9 percent to $755 an ounce.

The platinum group metals market now digests the U.S. auto sales data in May, as strong pickup truck sales and an improving housing market lifted results of major automakers.

  Price   Change %Change
GLDiv.P
---
SILV/USD
---
PLAT/USD
---
PALL/USD
---

Featured