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PRECIOUS-Gold set for best week in three months, near April highs
June 20, 2014 / 3:23 AM / 3 years ago

PRECIOUS-Gold set for best week in three months, near April highs

* Gold falls after 3.3 percent jump overnight
    * Trades near 2-month high

 (Updates prices)
    By A. Ananthalakshmi
    SINGAPORE, June 20 (Reuters) - Gold eased on Friday on
profit taking after posting its biggest one-day rise in nine
months, but the safe-haven metal was trading near April highs
and set for its best week in three months on geopolitical
tensions and a softer dollar.
    Gold posted its biggest jump since September on Thursday, as
technical buying picked up on tensions in Iraq and was supported
by the Federal Reserve's lack of commitment to raise interest
rates. 
    "The move is largely short covering, but the investment
buying interest is not aggressive," said Ronald Leung, chief
dealer at Lee Cheong Gold Dealers in Hong Kong.
    "Geopolitical tensions and a softer dollar have prompted
some to cover their short positions. But this is unlikely to
last."
    Spot gold fell 0.6 percent to $1,311.30 an ounce by
0649 GMT, after jumping 3.3 percent in the previous session,
when it hit mid-April highs of $1,321.70. The metal has gained
about 3 percent for the week.
    "We see a convincing break above the $1,300 level as likely
to introduce further buying from momentum investors," HSBC
analysts wrote in a note.
    The dollar came under pressure this week after the U.S.
Federal Reserve's comments that it could keep interest rates low
in the longer term. 
    Physical demand for gold was soft. Traders said what little
demand they had seen earlier in week had been erased by
Thursday's price jump.
    "Demand was slightly better when prices had steadied around
$1,270 but with this move above $1,300, we have seen a pull
back," said a trader in Hong Kong. 
    Private sector gold demand in China, which last year
surpassed India to become the biggest consumer of the yellow
metal, will be flat to slightly lower this year, an official
from the China Gold Association said on Thursday.
    
    Among other precious metals, silver was little
changed after jumping 4 percent in the previous session, while
platinum group metals also eased after sharp overnight gains.   

    PRICES AT 0649 GMT    
 Metal            Last     Change   Pct chg
                                           
 Spot gold         1311.3     -8.4    -0.64
 Spot silver        20.65    -0.05    -0.24
 Spot platinum       1462    -4.95    -0.34
 Spot palladium    831.65    -2.05    -0.25
 Comex gold        1311.8     -2.3    -0.18
 Comex silver       20.68    0.032     0.15
 Euro              1.3619                  
 DXY               80.257                  
                                           
 COMEX gold and silver contracts show the
 most active months
 
    

 (Reporting by A. Ananthalakshmi; Editing by Michael Perry and
Richard Pulin)

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