Thursday 28 August 2014

Gold up for third day on softer dollar; physical demand lags

Gold rose for the third straight day on Thursday on softening dollar and increased tensions between Ukraine and Russia, but the precious metal was under pressure from rallies in equities and the prospect of a US interest rate hike. 

Higher interest rates would dull the appeal of non-interest-bearing assets such as gold, which was struggling to cross the key resistance of $1,300 an ounce. Gold prices were more than $600 below a record hit in 2011. 

Gold added 0.56 per cent to $1,289.60 an ounce by 0635 GMT, moving away from a two-month low of $1,273.06 hit on Aug. 21. 

In other markets, Asian shares held steady after pulling back from a 6-1/2 year high as the recent rally in risk assets petered out for now, while the euro clung to modest gains after rebounding from 13-month lows. 


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