Gold finishes higher for a fourth straight session
San Francisco (Mar 23) Gold futures finished higher on Monday for a fourth session in a row with concerns surrounding Greece’s debt problems and a sharp drop in the U.S. dollar providing support for the metal.
Gold for April delivery on Comex GCJ5, +0.49% rose $3.10, or 0.3%, to settle at $1,187.70 an ounce on Comex. May silver SIK5, +1.17% added less than a penny to $16.891 an ounce. Gold ended Friday with a 2.8% gain for the week, while silver jumped around 9%.
“Gold is being supported by jitters in European markets due to concerns about the Greek debt crisis, which looks like it may soon come to a head,” said Dublin-based Mark O’Byrne, a director at GoldCore, in emailed comments. “Greece is running out of cash quickly which is heightening the risk of a ‘Grexit’ and a return to the ‘drachma’, or alternatively to Cyprus style bail-ins.”
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In an address to the European Parliament committee Monday, European Central Bank President Mario Draghi said dialogue between Greece and lenders needs to be restored and that Greece must fully honor its debt commitments to all creditors. Greek Prime Minister Alexis Tsipras is meeting Monday with German Chancellor Angela Merkel.
Meanwhile, the gold market took some cues from the latest moves in the dollar DXY, -0.80% which saw a steep decline on Monday. Commodities priced in dollars can trade inversely with the dollar, as moves in the U.S. unit can influence the attractiveness of those commodities to holders of other currencies.
The dollar last week took a breather from a torrid rally that had put pressure on gold and other commodity markets, after the Federal Reserve appeared to signal that rates would rise more slowly than had been anticipated by the market.
In other metals trading, April platinum PLJ5, +0.62% settled up $3.30, or 0.3%, at $1,144.50 an ounce, while June palladium PAM5, -0.33% fell $8.40, or 1.1%, to $770.70 an ounce.
May copper HGK5, +5.16% tacked on 2.85 cents, or 1%, to $2.7895 a pound.
“Inventory levels for copper have been growing for over a year,” said Jeffery Born, a professor of finance at the D’Amore McKim School of Business at Northeastern University. “This overhang will no doubt flood into the market should copper prices show any sustained strength.”
Source: MarketWatch
