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Gold futures jump to 3-week high on mounting Greece fears

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Forex Pros - Gold futures extended gains on Tuesday, jumping to the highest level in three weeks as ongoing concerns over the euro zone's peripheral sovereign debt crisis boosted the safe haven appeal of the precious metal.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at USD1,527.95 a troy ounce during U.S. morning trade, climbing 0.61%.

It earlier rose as much as 0.66% to USD1,528.85 a troy ounce, the highest price since May 4.

Earlier in the day, the leader of Greece's main opposition party, Antonis Samaras rejected the country's new austerity plan, saying the measures would deepen Greece's recession and do little to close the country's budget gap.

Meanwhile, rating agency Moody's said Portugal and Ireland would be at risk of multi-notch credit downgrades, pushing their ratings into junk territory in the event of a default by Greece.

On Monday, Greece's cabinet broadly approved EUR6 billion in new austerity measures, aimed at narrowing the budget deficit this year.

The news boosted gold prices in euro to a fresh record high of EUR1,082.55 an ounce. Investors often buy gold as a refuge against economic and political uncertainty.

Weakness in the dollar had also contributed to gold's strength. The dollar index was down 0.34% to hit 76.03, after earlier dropping to 75.99.

Dollar weakness usually benefits gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies.

Elsewhere, silver for July delivery surged 3.55% to trade at a two-week high of USD36.33 a troy ounce during U.S. morning trade, while copper for July delivery jumped 1.85% to trade at USD4.052 a pound.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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