Gold is rip­ping higher


The pre­cious me­tal gained about 1.14%, or $11 an ounce to as high as $1,120.80. Af­ter cross­ing the key $1,110 level ear­lier this week, gold has climbed to a three-week high.

Gold was part of the rout in com­modi­ties that ac­cel­er­ated in June and July. The me­tal flash-crashed July 19, and sank fur­ther af­ter China dis­closed lower-thanex­pected cen­tral bank stock­piles.

Sev­eral an­a­lysts put out very bear­ish out­looks for gold, with Mor­gan Stan­ley say­ing last month that China's an­nounce­ment was "the latest in a string of bear­ish events." And in a note Mon­day, the com­mod­ity team low­ered its price out­look for gold by 8% for the sec­ond half of the year, and 1% by 2016.

The team sees gold av­er­ag­ing $1,139 an ounce for this year ver­sus $1,189 prior. Over the last two days, how­ever, the me­tal has caught a bit of a break from its slide.

Mar­kets have been fo­cused on China, where the cen­tral bank de­val­ued the cur­rency amid a slow­ing econ­omy.

In a morn­ing note to clients, Ac­cendo Mar­kets wrote, "Gold ($1114) ben­e­fit­ting from China's Yuan be­ing al­lowed to de­value again, with the prospect of a cur- rency war draw­ing risk averse in­vestors into the safer haven of an al­ter­na­tive cur­rency that sets its own price."

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