Buyers are valuing these price levels as a good opportunity in longer time horizon
Gold climbed for the first time in three days in New York as a weaker dollar boosted demand for an alternative investment.
The euro rose against the dollar on optimism a bailout for Ireland will prevent contagion across the region’s larger debt markets, and before a report that may show US initial jobless claims rose last week.
Bullion, which typically moves inversely to the greenback, slumped 4.7 percent in the four days through yesterday. It reached a record $1,424.30 an ounce on November 9.
An analyst at LGT Capital Management in Pfaeffikon, Switzerland Bayram Dincer said: “Short term uncertainty about the US dollar is supporting prices. Opportunistic buyers with a longer time horizon are valuing these price levels as a good opportunity.”
Gold futures for December delivery added $18.30, or 1.4 percent, to $1,355.20 an ounce at 8 am on the Comex in New York. The metal for immediate delivery in London was 1.5 percent higher at $1,355.68.
Bullion rose to $1,356.75 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,337.50 at yesterday’s afternoon fixing.
Irish Finance Minister Brian Lenihan said the government is prepared to ask for a rescue package for its banks. European policy makers will scan the books of Ireland’s debt-laden banks to determine whether the government can fix the banking system on its own or needs to fall back on the $1 trillion European Financial Stability Fund.
Irish central bank Governor Patrick Honohan said he expects the country to ask for a “substantial” bailout from the European Union and the International Monetary Fund.
A US Labor Department report today will show the number of Americans filing initial jobless claims increased 6,000 last week, according to the median forecast of economists in a Bloomberg News survey.
Silver probably will top $30 an ounce in 2011 on demand by investors seeking a protection of wealth, London based research firm GFMS Ltd. said in a report today. The metal will average $19.94 an ounce this year and about $28 next year, GFMS said. Futures have averaged about $19.13 so far this year.
Silver for December delivery in New York gained 4.2 percent to $26.57 an ounce. It reached a 30 year high of $29.34 last week and is up 58 percent this year.
Palladium for December delivery climbed 4.4 percent to $683.90 an ounce. Platinum for January delivery was 0.7 percent higher at $1,653.50 an ounce after falling the previous two days. The metal yesterday slipped to $1,628, the lowest level since September 28.