Gold climbs after Italian debt auction
Gold prices rose this afternoon, driven by a combination of demand from bargain hunters and renewed worries over Italy's debt problems. Traders bought into the cheaper price after the yellow metal fell sharply on Monday under pressure from a surge in the US dollar.
The American currency rallied as the euro declined after a high ranking member of Germany Chancellor Angela Merkel's Christian Democratic Union openly discussed the possibility of Greece defaulting on its debts and leaving the euro zone.
Today, the US dollar pulled back, boosting demand for gold, which is seen as an alternative investment to the greenback.
In the meantime, concerns over another debt laden euro zone member Italy were reinforced by today's disappointing Italian debt auction, which saw its 10 year bond yields climb 0.1 to 5.67 percent.
The results of the auction dampened confidence in Europe's ability to handle its financial problems and increased gold's appeal as a safe haven asset.
Gold traded at US$1,822/oz this afternoon, up US$8 from Monday's close. Silver rallied 17 cents to US$40.46/oz and platinum held steady at US$1,802/oz.
Today's top risers in the sector were:
Caledonia Mining (LON:CMCL), up 8 percent at 6.75 pence at midday
Goldplat (LON:GDP), up 6 percent at 12.69 pence
Bezant Resources (LON:BZT), up 4 percent at 35.37 pence
Trans-Siberian Gold (LON:TSG), up 4 percent at 93 pence
The top fallers were:
Orsu Metal (LON:OSU), down 9.5 percent at 9.86 pence at midday
Oxus Gold (LON:OXS), down 6 percent at 0.8 pence
Patagonia Gold (LON:PGD), down 5 percent at 65 pence
Fresnillo (LON:FRES), down 3.5 percent at 1,918 pence
Peninsular Gold (LON:PGL), down 3.5 percent at 32.5 pence
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