GOLD STRENGTHENS AFTER LAST WEEK 2 PERCENT SLIDING

Updated: 07/13/2009 23:35
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Early on Monday bullion firmed after last week's 2% fall. Investors watching the dollar rise and weak oil prices have heightened concerns

Early on Monday bullion firmed after last week's 2% fall. Investors watching the dollar rise and weak oil prices have heightened concerns about an economic recovery and weakened bullion's appeal as an inflation security tool.
Spot gold was traded at $913.00 per ounce as of 11:22 p.m. EDT, compared to New York's notional close of $912.15 on Friday.
Gold has lost that appeal as falling oil prices on economic worries have alleviated the need for an inflation hedge, while the U.S. dollar and U.S. Currently, Treasury bonds are being chosen as a safe haven option over bullion.

A commodities sales official at a foreign securities firm said investors were still liquidating long positions, suggesting that there was still scope for a further drop in gold prices, although firm support was seen around gold's 200-day moving average which currently stands near $877.
Noncommercial net long New York gold futures positions melted down slightly 164,144 lots in the week to July 7 from 164,186 lots the weekly Commitments of Traders report by the Commodity Futures Trading Commission showed.

However, precious metal was not expected to lead the markets drop, with investors watching upcoming data and US second-quarter corporate earnings results to gauge the economic outlook for the second half.
US gold futures for August delivery were also little changed at $913.00 an ounce, compared to $912.50 an ounce on the COMEX division of the New York Mercantile Exchange.
The SPDR Gold Trust reported its holdings to stay at 1,109.81 tonnes as of July 10, unchanged from the previous business day.


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