Gold News & Info

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold gained nearly 1% to close over $1,245, its highest in a week, as rising consumer prices in China spurred demand for the metal as an inflation hedge. China's CPI rose 2.7% in June, more than expected and far more than in May, driving Asian investors into physical gold bullion, coins, and jewelry.

Gold futures posted their second winning session despite a rallying the U.S. dollar, which reached a three-month high against the euro and a three-year high against the British pound. A rising dollar typically weighs on gold prices because gold is denominated in dollars internationally, making it more expensive to holders of other currencies.

Gold was also buoyed by rising rates for leasing the metal, indicating a temporary shortage in the market that is causing suppliers to borrow gold in order to meet physical demand. The one-month rate for leasing gold jumped to its highest level since December 2008. Hedge funds and other large-scale money managers increased their bullish bets on gold by nearly 10% last week. The other precious metals tracked gold higher, with silver and platinum both adding 0.5% while palladium picked up 0.3% after strikers in South African mines retuned to work

At the Comex close: August gold gained $11 to $1,245.90; September silveradded 10 cents, to $19.14; October platinum rose $6.60, to $1,368.60, and September palladium picked up $1.95 to $697.35 an ounce.