REFILE-PRECIOUS-Gold falls as euro zone worries trigger selling

Tue Nov 13, 2012 3:15am IST

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* Investors take profits after last week's gain
    * U.S. 'fiscal cliff,' safe-haven demand in focus
    * Coming up: Johnson Matthey platinum group report Tuesday

    By Frank Tang
    NEW YORK, Nov 12 (Reuters) - Gold moved lower on Monday as a
lack of an agreement by euro zone governments to disburse more
money to Greece prompted bullion investors to sell and take
profits.
    The metal on Monday largely tracked lower with riskier
assets such as the euro after euro zone finance ministers gave
Athens two more years to make the budget deficit cuts they
demanded. 
    A steadier Wall Street, amid better economic sentiment
following last week's over 2 percent drop in S&P 500 index
, lessened safe-haven demand in gold, analysts said.
    "Healthy economic data in the short term will be negative
for risk-on markets as it reduces the urgency for global central
banks to continue their 'easy money' stance," said Adam Sarhan,
CEO of Sarhan Capital.
    Spot gold edged down 0.2 percent to $1,727.39 by 3:33
p.m. EST (2033 GMT), within reach to a three-week high around
$1,738 struck on Friday.
    Flight-to-quality buying lifted gold 3.2 percent last week,
its biggest weekly rise since late August.
    Global markets have turned their focus from the election to
the U.S. "fiscal cliff", a combination of government spending
cuts and tax increases due to be implemented under existing law
in early 2013. 
    Gold would benefit from the government spending cuts and tax
increases as a U.S. fiscal crisis could send the economy back
into recession, economists say.
    An encouraging U.S. nonfarm payrolls report earlier this
month had erased all of gold's gains, gains that followed the
Federal Reserve in September announcing it would keep buying
mortgage-backed securities until the job market dramatically
improves.
    U.S. COMEX gold futures for December delivery settled
unchanged at $1,730.90 an ounce.
    Trading volume was lower than usual, 30 percent below its
250-day average, as the U.S. bond market was closed for the U.S.
Veteran's Day holiday and as the Hindu festival of Diwali began
in India.
    Silver dropped 0.6 percent to $32.38 an ounce.
    In metals exchange news, the president of the Shanghai Gold
Exchange told Reuters at the London Bullion Marketing
Association (LBMA) conference that the bourse would launch an
interbank market early next month that would start with spot
contracts and gradually offer forward contracts. 
    Among platinum group metals, platinum rose 0.5
percent to $1,558.10 an ounce, while palladium inched 
down 12 cents at $603.80 an ounce.
    PGM traders will closely watch an industry report on Tuesday
by platinum refiner Johnson Matthey which will shed light on
whether reduced supply due to mine labor violence in top
producer South Africa might turn the market into a deficit this
year.

 3:33 PM EST     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold DEC   1730.90   0.00   0.0  1725.20 1738.00  100,869
 US Silver DEC  32.522 -0.077  -0.2   32.175  32.745   31,519
 US Plat JAN   1566.50   7.10   0.5  1555.40 1571.80    3,911
 US Pall DEC    608.05  -3.00  -0.5   606.00  614.45    2,760
                                                               
 Gold          1727.39  -3.52  -0.2  1726.38 1737.80         
 Silver         32.380 -0.200  -0.6   32.230  32.740
 Platinum      1558.10   8.11   0.5  1557.50 1567.25
 Palladium      603.80  -0.12   0.0   609.00  612.50
                                                               
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold        127,854   151,895   177,297     15.87   -0.11
 US Silver       40,260    42,511    55,943     23.94   -0.34
 US Platinum      4,067     8,893     9,465     18.84    0.00
 US Palladium     3,055     3,457     4,495
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