Gold traded near the highest level in more than six weeks as a retreat in the dollar and global equities boosted demand for a protection of wealth. Silver climbed to the highest level since October.
Bullion for immediate delivery rose as much as 0.6 percent to $1,238.30 an ounce, and traded at $1,231.75 at 4:15 pm in Singapore, after falling 0.3 percent earlier, according to Bloomberg generic pricing. The metal advanced yesterday to $1,238.32, the highest price since Oct. 23, and a third day of gains today would be the longest rally since Oct. 9.
Gold climbed as Asian stocks extended a global rout on concern that growth may slow in China and an election will be called in Greece, while oil prices traded near the lowest level in five years. The Bloomberg Dollar Spot Index fell for a third day before the Federal Reserve meets next week to debate the timing of the first interest-rate increase since 2006.
“Risk aversion is rising, supporting precious metals as investors choose gold to hedge against a falling dollar and the poor performance of the global stock market,” said Mark To, head of research at Wing Fung Financial Group, a trader and refiner in Hong Kong. “Next week’s Fed meeting will provide the market with more signals.”
Gold for February delivery increased 0.3 percent to $1,235.90 an ounce on the Comex in New York, extending a two- day, 3.5 percent gain that was the most since October 2013.
Assets in the SPDR Gold Trust, the largest bullion-backed exchange-traded product, rose the most since September yesterday, and volumes for the Shanghai Gold Exchange’s benchmark contract climbed to the highest since Nov. 27.
Silver for immediate delivery rose as much as 0.9 percent to $17.2327 an ounce, the highest price since Oct. 29, and traded at $17.127. Platinum climbed 0.1 percent to $1,248.55 an ounce, while palladium advanced as much as 0.8 percent to $815.34 an ounce, the highest since Nov. 28, and was at $813.75.
©2014 Bloomberg News