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Gold is up but silver falls

Reported by AAP
Tuesday, April 10, 2012
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Gold have risen as traders bet last week's US unemployment report increased the likelihood that the Federal Reserve would maintain its accommodative policy to boost the economy.

The most actively traded contract, for June delivery, rose $US13.80, or 0.9 per cent, to settle on Monday at $US1,643.90 a troy ounce on the Comex division of the New York Mercantile Exchange. Comex gold trading was closed Friday in observance of the Good Friday holiday.

The US economy added much fewer jobs than expected in March, the Labour Department said Friday, boosting the view that the Fed would hold to its accommodative monetary policies in an effort to prop up growth.

Some investors buy gold as a hedge against the declines in the US dollar that easy-money policies can bring. The view that the US central bank may be more likely to take new measures after the sluggish gains in employment in March drew buyers to gold Monday.

"The door to further quantitative easing remains ajar," analysts with Barclays said in a note, referring to central-bank asset purchases.

Gold prices had climbed to just short of $US1,800 a troy ounce in late February, fuelled by the view that quantitative easing was near. But futures retreated as surprising strength in the US economy and comments from Fed chief Ben Bernanke were seen limiting the chance of further central bank stimulus soon.

Futures last week touched their lowest levels since early January.

"Right now, we have investors buying into gold, thinking its a pretty good value anywhere below $1,650," said Jimmy Tintle, a market analyst with GreenKey Alternative Asset Services.

Sentiment in the gold market was also lifted as jewellers in India on Friday ended their strike after assurances that the government would consider their request for a rollback of new taxes on gold imports and sales.

"All shops have re-opened," said Prithviraj Kothari, president of the Bombay Bullion Association, a trade group.

"Gold demand should pick up," Kothari said, adding that imports are expected to rise in April and May.

India is the world's top gold importer, and the 20-day strike in protest of the new taxes weighed on global prices.

In other precious metals: May delivery silver closed at $US31.524, down 20.6 US cents; July platinum finished at $US1,618.20, up $US10.60; while June palladium ended at $US643.80, down $US1.00

*Fix is for April 5; no fix April 6, 9 for Good Friday, Easter holidays.

20/12/2014 07:13Sydney, Australia. 20 December,2014
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