Gold News & Info

Source: Marketwatch

San Francisco— Gold futures rose Monday to close near $559 an ounce — recovering the bulk of the previous session's loss as weakness in the U.S. dollar sparked investment demand for the precious metal.

The dollar fell against major currencies after new speeches from Federal Reserve and European Central Bank officials suggested that the difference between U.S. and eurozone rates could shrink this year.

Against this backdrop, gold for February delivery climbed $4.70 to finish at $558.70 an ounce. The contract struck a fresh 25-year high at $568.50 Friday before losing $5 at the close as traders locked in gains.

Gold found support from the dollar's weakness and worries about developments surrounding Iran's nuclear program, as well as from signs the Fed may be reaching the end of its rate-raising cycle.

In any case, "the longer-term outlook for gold remains robust given constrained output and soaring physical demand from the major emerging economies of India and China," according to Action Economics.

Market dynamics were also at play. "The real driver of the gold price continues to be lack of selling, leaving a small volume of investment/speculative buyers calling the shots," said Julian Phillips, an analyst at GoldForecaster.com.

"With a huge number of buyers waiting for lower prices, this price looks like it will consolidate around $550 to $565 or run still higher this week," he added.

Indeed, "flurries of buying coupled with a lack of serious offers still has the potential to generate fresh price spikes and setting a new 25-year high," despite the fact the market is starting to look "top-heavy" and in need for some consolidation," wrote James Moore, analyst at TheBullionDesk.com, in an email update.

Rounding out the action in metals, March silver futures closed up 14.3 cents at $9.073 an ounce, while March palladium rose $1.60 to end at $279.30 an ounce and March copper tacked on 2.95 cents to close at $2.1195 a pound. April platinum traded as high as $1,054 an ounce, another 26-year high, before closing up $17.60 at $1,053.80 an ounce.

On the supply side, copper inventories rose 658 short tons to 8,420 short tons as of late Friday, according to the New York Mercantile Exchange. Gold stocks fell 195 troy ounces to 7.169 million troy ounces, while silver inventories dipped 5,114 troy ounces to 121.2 million.