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Tuesday, September 15, 2009

Yellow metal drops from eighteen month high

Precious metals slip as dollar edges up

Precious metal prices ended lower on Monday, 14 September, 2009. Prices rose as the dollar strengthened. Yellow metal prices fell from eighteen month high level.

Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.

On Monday, gold for December delivery ended at $1001.1, lower by $5.3 (0.5%) an ounce on the New York Mercantile Exchange. Last week, gold ended higher by 1%. Year to date, gold prices are higher by 14.5%.

Gold ended August, 2009 higher by 0.2%. Before this, for the second quarter, gold ended higher by 0.5%. The metal had gained 4.3% in the first quarter of this year.

On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped somewhat (2.5%) since then.

On Monday, Comex silver futures for December delivery fell 7.7 cents (0.5%) to $16.623 an ounce. Last week, silver ended higher by 2.5%.

Silver ended 7.1% higher for August, 2009. For second quarter, silver rose 4.5%. Year to date, silver has climbed 44% this year. For 2008, silver had lost 24%.

In the currency market on Monday, the dollar index, which measures the strength of dollar against a basket of other currencies, rose by 0.4%.

In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.

At the MCX, gold prices for October delivery closed lower by Rs 44 (0.3%) at Rs 15,791 per 10 grams. Prices rose to a high of Rs 15,869 per 10 grams and fell to a low of Rs 15,734 per 10 grams during the day's trading.

At the MCX, silver prices for December delivery closed Rs 198 (0.73%) lower at Rs 26,735/Kg. Prices opened at Rs 26,830/kg and fell to a low of Rs 26,450/Kg during the day's trading.

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