Gold was holding up well near two-week highs on Friday morning, with renewed concerns over a possible Grexit offsetting the dollar’s gains.
The spot gold price of $1,172.50/1,173.30 per ounce was up $1.20 on the previous session’s close and just short of two-week highs at $1,178.
“The pullback in the dollar saved the gold price from testing the all-important November low but, if the dollar continues to rebound, the precious metals are likely to struggle again,” FastMarkets analyst William Adams said.
The US currency has dollar regained 1.0660 against the euro, having hit lows of 1.10 earlier in the week after the US FOMC suggested it had a longer timeline for rate rises.
“The next few days are likely to be crucial in seeing whether the market is taking a potential delay in higher US interest rates in its stride or whether it thinks the Fed is finding one excuse after another not to rock the boat. If the latter, we would expect some dollar weakness – at least for a while,” Adams added.
Still, renewed concerns that Greece may exit the eurozone are providing an element of safe-haven support this morning, with the country expected to submit further reforms to receive further aid and avoid a default later today.
Early expectations are that Greece could run out of money within just a few weeks should a deal not be brokered.
“In other words, the uncertainty over whether Greece will remain in the eurozone remains, which should make gold attractive as a safe haven,” Commerzbank noted.
Greece Prime Minister Alexis Tsispras is due to meet German Chancellor Angela Merkel on the sidelines of an EU summit today in what is being described as showdown talks alongside French President Francois Hollande.
In other news, the first LBMA gold price via new administrator ICE took place this morning, with the six participants setting the price at $1,171.75 per ounce. The six banks taking part currently are Scotiabank, UBS, Société Générale, Barclays, HSBC and Goldman Sachs.
The data calendar today is light. Earlier, the German PPI at 0.1 percent fell short of forecasts while the eurozone current account at 29.4 billion euros bettered consensus at 21.3 billion euros.
Other metals were also up – silver was last six cents higher at $16.17/16.22 per ounce, platinum gained $3 to $1,122/1,127 and palladium climbed $6 to $768/774.
(Editing by Mark Shaw)
The post Gold holds near 2-wk highs, renewed Grexit fears support appeared first on The Bullion Desk.
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