Saturday, 19 May 2012

MCX Gold Again Rises Weekly Gain, as Euro Recovers

MCX Gold prices rose towards USD 1,590 an ounce in Europe on Friday, building on the previous session's hefty gains, as a recovery in the euro prompted some buying of the precious metal, with shorts covering amid expectations prices could rise further. More Information about Free mcx gold tips visit my site

MCX Gold posted its biggest one-day gain since January 25 on Thursday, recovering some ground lost during its longest run of losses in five months. Its reversal has put it on track to end the week 0.5% higher.

Spot MCX gold was up 0.9% at USD 1,587.45 an ounce at 0933 GMT, having earlier touched a high of USD 1,589.10, while US MCX gold futures for June delivery were up USD 12.51 an ounce at USD 1,587.41.

The euro recovered from an early four-month low against the dollar to move into positive territory, taking some downward pressure off MCX gold, though confidence in the currency remained weak.

MCX Gold's relationship to heightened risk aversion has been rocky since the start of the crisis. It rose to record highs last year in part because investors were buying the metal as a safe store of value, but as the dollar and treasuries found greater favour as havens, it slipped back along with the euro.

"In this multi-crisis environment, we are seeing a change in attitude towards risk in gold, so we are very optimistic," LGT Capital Management analyst Bayram Dincer said.

"We got to the point where the year-to-date performance was zero, and from a risk perspective people started to recognise that this was somewhere with lower risk compared to other asset classes."

"Yesterday, MCX gold defied a stronger dollar, weaker equities, and another raft of negative EU headlines (to rise). It felt like the gold market of yesteryears," UBS said in a note.

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