GOLD stocks Surge after hitting 2 Months Lows on the Metal.
Gold Climbs From Two-Month Low in Asia as Commodities Rebound
By Glenys Sim
July 9 (Bloomberg) -- Gold advanced from a two-month low in Asia as commodities rebounded and the dollar fell against the euro, boosting demand for the metal as a hedge against rising consumer prices.
Bullion, which dropped to $905.10 an ounce yesterday, the lowest since May 6, climbed on inflation expectations as the U.S. government considers more stimulus measures to revive the world’s largest economy. The dollar fell for the first time in six days against a basket of six currencies.
“Those who believe that the printing presses of the governments are going to eventually lead to an out of control inflationary spiral are going to want to accumulate gold, silver and to some extent platinum,” Philip Gotthelf, president of Equidex Brokerage Group in Closter, New Jersey, said in a Bloomberg Television interview.
Gold for immediate delivery rose as much as 0.5 percent to $913.60 an ounce, and traded at $913.08 at 2:21 p.m. in Singapore. Gold for August delivery on the Comex division of the New York Mercantile Exchange was up 0.4 percent at $913.
The U.S. should consider drafting a second stimulus package focusing on infrastructure projects because the $787 billion approved in February was “a bit too small,” Laura Tyson, an outside adviser to President Barack Obama, said July 7.
Crude oil yesterday led a drop in commodities, on speculation a faltering global economy will damp demand for raw materials from copper to gasoline. The contract for August delivery gained as much as 1.2 percent to $60.87 a barrel today.
The dollar index fell 0.4 percent to 80.411 by 2:22 p.m. in Singapore, aiding the rebound in commodities. A weaker U.S. currency helps boost demand for raw materials priced in dollars.
Among other precious metals for immediate delivery, silver gained 0.3 percent to $12.925 an ounce, platinum rose 0.7 percent to $1,109.50 an ounce and palladium added 0.2 percent to $236.75 an ounce.
To contact the reporter on this story: Glenys Sim in Singapore at firstname.lastname@example.org Last Updated: July 9, 2009 02:47 EDT