Monday, Oct 13, 2008
Gold gained 2 percent on Monday, recovering from its biggest one-day drop in nearly 30 years the previous session, as moves by policymakers around the world to help banks pulled down the dollar.
Prospects for an easing in the month-long financial crisis could dim investors’ interest in gold as a safe haven, but should also stem the kind of frenzied liquidation that knocked nearly $65 an ounce off the metal on Friday, the biggest one-day fall in dollar terms since 1980.
“Because we’re seeing a bit of a bounce on currency markets, that’s giving gold a lift,” Australia & New Zealand Bank research head Mark Pervan said.
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“But a rebound in the U.S. dollar that would accompany a recovery in stocks would be bad for gold and we could see prices hit again,” he said.
Spot gold <XAU=> rose $14.95 or 1.76 percent to bid at $862.35 against a notional close of $847.40 on Friday, when prices were whipsawed in a nearly unprecedented range of more than $100.
Gold hit a one-week low of $823.50 on Friday as investors sought cash to cover margin calls from steep losses in stocks, having earlier rallied to a two-month high at $931 an ounce.
This article was posted: Monday, October 13, 2008 at 4:05 am