iNVEZZ.com, Monday, August 19: Gold price today hit a fresh two-month high as weak US data boosted the gold safe-haven appeal and further inflows into the world's biggest gold-backed exchange traded fund (ETF) provided additional support.
Last week SPDR Gold Trust recorded its first weekly increase in holdings since November 2012. In other precious metals, silver lost some ground but remained stable above $23 an ounce.
Among industrial metals, copper slipped weighed down by uncertainty over the timing of potential Fed tapering of monetary stimulus. The fall in the copper price was mirrored by declines in all other base metals.
Gold and silver
Gold price railed to a two-month high of $1,384 an ounce, but later lost some momentum and retreated to $1,367.10 as of 15:45 BST. The metal has gained a total of eight percent in the last nine sessions, boosted by weaker US dollar, short-covering and technical buying. Last week was particularly strong with bullion gaining nearly five percent.
Signs of increasing physical demand, and a turnaround in the outflows from gold-backed ETFs have also supported prices.
"Last quarter what was tugging at gold prices was the fight between money managers who are very bearish on gold and physical buyers who were quite bullish," said Joyce Liu, an investment analyst at Phillip Futures in Singapore, as quoted by Reuters.
"The outlook is slightly better now as it looks like we have bottomed out on the outflows."
Gold holdings in SPDR Gold Trust increased 0.4 percent last week to 915.32, its first increase since November 2012.
The silver price today lost 11 cents to $23.09 as of 16:00 BST. The metal outperformed gold last week, gaining 14 percent - its biggest weekly advance in nearly five years.
Base metals decline
Three-month copper today declined on the London Metal Exchange as traders waited for clues on the Federal Reserve plans to reduce quantitative easing. The US central bank is due to publish minutes of its July 30-31 meeting on Wednesday, which could give indication on whether it plans to start scaling back the stimulus soon.
The copper price fell to $7,305 a metric ton from a close at $7,400 on Friday.
Other industrial metals today also slipped on the LME, with the tin price down $100 from its close at $21,925 a ton on Friday. Aluminium price declined to $1,931 from a close of $1,945; lead price has been at $2,241, down from $2,249.50; nickel price lost $245 to $14,750 and zinc, untraded in rings, was bid at $1,994, down from a close of $2,008 on Friday.