Gold may climb for a fourth day on Euro­pean cri­sis, China im­ports

The Pak Banker - - International3 -

SHANG­HAI: Gold may rise for a fourth day in London as con­cern about Europe's debt cri­sis spurs de­mand for a pro­tec­tion of wealth and as China's bul­lion im­ports surged. Pal­la­dium climbed to a nineyear high.

China's gold im­ports jumped al­most five­fold in the first 10 months from the en­tire amount last year as con­cern about ris­ing in­fla­tion in­creased its ap­peal as a store of value, the Shang­hai Gold Ex­change said. The dol­lar fell against the euro be­fore the Euro­pean Cen­tral Bank an­nounces its de­ci­sion on in­ter­est rates and any steps to stem the re­gion's fis­cal woes. Gold reached a record $1,424.60 an ounce on Nov. 9.

"While the re­turn of risk ap­petite hasn't crimped gold's safe-haven ap­peal, de­cent re­sis­tance is block­ing the yel­low metal's re­turn to $1,400," Edel Tully, an an­a­lyst at UBS AG in London, said in a re­port. "Mar­ket at­ten­tion to­day will be fo­cused on the Euro­pean Cen­tral Bank meet­ing," and the Chi­nese im­port com­ments "have added to gold's ap­peal," she said.

Im­me­di­ate-de­liv­ery bul­lion added $3.72, or 0.3 per­cent, to $1,391.63 an ounce at 10:10 a.m. in London. It yes­ter­day reached $1,397.50, the high­est price since Nov. 12. The metal for Fe­bru­ary de­liv­ery was 0.3 per­cent higher at $1,392.70 on the Comex in New York.

The euro this week fell to a two-month low ver­sus the dol­lar as con­cern deep­ened that the re­gion's debt cri­sis would spread. Pol­icy mak­ers will to­day keep their bench­mark rate at a record low 1 per­cent, ac­cord­ing to all 52 econ­o­mists in a Bloomberg sur­vey. ECB Pres­i­dent Jean-Claude Trichet will hold a press con­fer­ence in Frank­furt fol­low­ing the de­ci­sion. China's im­ports gained to 209 met­ric tons com­pared with 45 tons for all of 2009, Shen Xian­grong, chair­man of the bourse, told a con­fer­ence in Shang­hai to­day. -Reuters

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