Gold declines as three-month high prices curb demand

Written by Agencies | London | Updated: Feb 28 2012, 18:43pm hrs
GoldGold
Gold on Monday declined 0.3% to $1,767.30 an ounce as prices near a three-month high by adding 2.8% last week, curbed physical purchases of the metal.

Silver also fell 0.5% to $35.22 an ounce. Its the best-performing precious metal this year, up 26%.

Bullion climbed to $1,787.55 an ounce on February 23, the highest price since November 14.

The dollar climbed against the euro as Moodys Investors Service said Greek default risk remains high after the nation formally asked investors to exchange their holdings of government debt for new securities last week.

Gold prices are up 13% this year after a 10% increase in 2011, an eleventh consecutive annual gain.

Gold prices in India rose by R30 to R28,895 per 10 gm on Monday, while silver gained R150 to R58,250 per kg on buying by retailers to meet the ongoing marriage season

demand.

Traders said marriage season buying was so strong that even a weak trend in the overseas market failed to impact the sentiment.

Shifting of funds from weakening equities to bullion also supported the uptrend in precious metals, they added.

Gold of 99.9 and 99.5% purity recovered by R30 each to R28,895 and R28,755 per 10 gm,respectively.

The metal had lost R175 in last two trading sessions.

Sovereign held steady at R23,500 per piece of 8 gm.

Silver ready rebounded by R150 to R58,250 per kg and weekly-based delivery by R205 to R58,670 per kg.

Silver coins continued to be asked around previous level of R72,000 for buying and R73,000 for selling of 100 pieces on restricted deals.