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Gold Advances on Investor Demand
for Haven, Falling U.S. Dollar
By Claudia Carpenter
Aug. 27 (Bloomberg) -- Gold rose in London on demand for precious
metals as a haven from housing-related financial losses and an
alternative investment to the declining dollar.
Gold extended its rebound from a nine-month low reached on Aug.
15. Demand for 1-kilo (2.2-pound) gold bars at the European
refineries of
Heraeus Holding GmbH has outstripped supply, with customers
waiting as long as two weeks for delivery of orders, said
Wolfgang Wrzesniok-Rossbach, head of marketing and sales.
``We had these housing problems three months ago but the price
was still high,'' Wrzesniok-Rossbach said from Hanau, Germany. ``The
problems are still there but the prices are much lower. This is why
people have come in and invested their money in gold.''
Gold for immediate delivery gained $7.44, or 0.9 percent, to
$832.34 an ounce as of 12:27 p.m. in London. The metal fell to
$772.98 on Aug. 15, the lowest since Oct. 26, after reaching a
record high of $1,032.70 on March 17.
The dollar fell from a six-month high against the euro today on
speculation U.S. economic data will suggest the Federal Reserve will
hold off raising interest rates.
Gold inflows of $306 million since the middle of July have led
funds moving into the exchange-traded commodities of ETF Securities
Ltd., the Jersey-based company said today in an e- mailed report. ``The
consistently strong inflows into the gold ETCs highlights investors'
continuing interest in buying safe haven assets as global economic
and financial conditions deteriorate and inflation remains high,''
it said.
Silver for immediate delivery rose 15 cents to $13.74 an ounce,
platinum gained $14, or 1 percent, to $1,434 an ounce, and palladium
increased $7.50 to $293.50.
Rhodium, used in autocatalysts, led the rebound in precious
metals, gaining $200 to $6,200 an ounce, Johnson Matthey Plc said.
Prices have climbed 61 percent in five trading sessions.
Investment in the
SPDR Gold Trust, the biggest exchange- traded fund backed by
gold, was unchanged since Aug. 19 at 651.37 metric tons.
To contact the reporter on this story:
Claudia Carpenter in London at
ccarpenter2@bloomberg.net
Last Updated: August 27, 2008 07:40 EDT
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