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Gold is set to record a second week of gains as investors continued to weigh various economic data and geopolitical tensions around the world against the strength of demand for a safe haven.
Spot gold was trading mid morning Singapore time at a price per ounce of $1,312.35, slightly lower than yesterday’s close of $1,313.52. Prices for the precious metal have gained 0.2% this week so far. Futures with a delivery date in December, meanwhile, declined by 0.2% to fall to a price per ounce o f $1,313.30 in New York’s Comex, but is still on track for a 0.2% advance for the week.
Reports listed on financial filings shows that hedge fund manager John Paulson whose investment firm Paulson & Co. is currently the largest investor in the SPDR Gold Trust, opted to keep his stake in the biggest gold backed exchange traded product at a steady 10.23 million shares at the end of June.
Various data which came out earlier this week provided multiple sources of pressure for gold. Growth in the eurozone was shown to have stalled during the second quarter while claims for unemployment benefits in the US increased more than expected last week. The level of new credit in China, the largest user gold globally, went through a surprise drop while the ceasefire in Gaza goes on its second day with Russia proposing their own truce with Ukraine to deliver humanitarian aid.
Analyst Edward Meir from New York’s INTL FCStone Inc. says that, “We are hard-pressed to see how much longer gold prices can hold up, especially if it is missing the twin buying engines that jewelry and investor demand could generate.”
Estimates for gold demand in India, the second largest user, was revised down from the previous 900-1,000 tons to 850-950 tons by the country’s managing director from the World Gold Council. Outlook on the demand from China was reduced as well to 900-1000 tons from the above 1,000 estimate made in February by the council’s Far East managing director.
Spot silver was mostly unchanged this week and was slightly down today at a price per ounce of $19.8725 from yesterday’s $19.8875. Platinum for immediate delivery is on track for a decline this week after falling 0.2% to $1,464, while palladium is likely to end its three week losing streak with a 0.2% gain to $884.50.
