Saturday, 2 June 2012

MCX Gold Heads for Weekly Loss

MCX Gold slipped on Friday, on course for a second straight week of losses, as a weaker euro sapped appetite for bullion amid the debt crisis in Europe while investors awaited a key U.S. employment report later in the day for further trading cues. More Information about Free mcx gold tips visit my site

Today MCX Gold briefly moved in tandem with the dollar in the previous session as safe-haven appetite overflowed from the greenback and U.S. Treasuries, but that quickly came to an end as Asian investors started the day fretting over the euro zone situation.

With big euro zone risk bubbling just below the surface and occasionally rising to a popping force, people are just uncomfortable holding risk, even MCX gold. All and all, bears are back in the woods again."

Spot MCX gold slipped 0.4% to USD 1,558.26 an ounce by 0641 GMT, recovering from an intra-day low at USD 1,548.52. MCX Gold fell 6.4% in May, the steepest monthly fall since December. It was headed for an almost 1% weekly loss.

MCX Gold had fallen nearly 20% from its peak of USD 1,920.30 hit last September, flirting near the edge of a technical bear market. The most-active U.S. MCX gold futures contract for August delivery dropped 0.3% to USD 1,559.90.

Bullion was pressured by a weaker euro, which dropped to its lowest level against the dollar in nearly two years, dogged by worries that Spain may need external aid to shore up its struggling banking sector and fix its public finances.

Prices are likely to remain volatile as investors follow the twists and turns in euro zone's struggle with the debt crisis and assess the possibility of more monetary stimulus, with the focus on June 17 Greek elections that may decide if the country will break away from the single currency bloc.

More disappointing data could fuel risk aversion, but weak data could also rekindle speculation of further monetary easing and lend support to bullion, which benefits from a low interest rate environment.

"But any bad news from euro zone could erase gold gains as people might need the cash for margin calls elsewhere," said a Tokyo-based trader.

Spot platinum was headed for its ninth straight week of loss, its longest losing streak in at least 27 years.

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