Gold At Three Week High
Gold and silver rose to three-week high based on European economic concerns.
Services and manufacturing signaled a slow down in Europe in the final quarter of 2014, leading to the euro to lose value. Money managers have increased bullish bets on gold for the first time in multiple weeks.
The metal increased 7.9 percent from a four-year low in November on political turmoil in Greece.
“Europe’s woes are bringing in some investors to gold,” James Cordier told Bloomberg. “We will probably see more people move into gold as a risk-off trade.”
Gold futures for February increased 1.3 percent, settling at $1,219.40 per ounce.
“The metal is in demand as traders want to hedge their position against Greek-exit uncertainty,” Naeem Aslam, the chief market analyst at Ava Capital Markets Ltd. in Dublin, said in an e-mail. While the chances of Greece leaving the euro zone are “very slim,” investors “do not want to put themselves under a situation where they are not hedged,” he said.
In 2014, gold posted a consecutive annual decline for the first time since 1998 as oil prices slumped and inflation remained muted amid bets that the Federal Reserve will raise U.S. interest rates.