Gold, Silver Post Longest Run of Weekly Advances in Five Months

Jun 27, 2014 2:39 pm ET

June 27 (Bloomberg) -- Gold and silver futures posted the longest run of weekly gains in five months as the dollar’s drop boosted demand for the metals as alternative investments.

The greenback fell to a seven-week low against a basket of 10 major currencies as reports this week spurred speculation that the U.S. economic recovery isn’t gaining traction. Gold climbed 6.8 percent in the first quarter, partly on the concern that growth was stalling.

“There are very mixed views about the economy, which are reflecting on the dollar and thus helping gold,” Blake Robben, a senior market strategist at Archer Financial Services in Chicago, said in a telephone interview.

Gold futures for August delivery rose 0.2 percent to settle at $1,320 an ounce at 1:39 p.m. on the Comex in New York. The price rose for the fourth straight week, the longest rally since Jan. 24. On June 24, the price reached $1,326.60, the highest since April 15.

This month, the World Bank cuts its forecasts for growth in the global economy and the U.S.

Gold has climbed 9.8 percent this year, partly as tensions in Iraq and Ukraine spurred demand for a haven. The precious metal headed for the second straight quarterly gain, the longest rally since 2011.

In 2013, gold tumbled 28 percent amid a U.S. equity rally to a record and expectations that the Federal Reserve would taper monetary stimulus. The metal rose 3.3 percent last week as Fed policy makers signaled that interest rates will remain close to zero percent for a considerable time.

Gold climbed 70 percent from December 2008 to June 2011 as the Fed bought debt and cut borrowing costs.

14-Week High

Silver futures for September delivery fell 0.1 percent to $21.134 an ounce on the Comex. Earlier, the price reached $21.25, the highest since March 18. The metal advanced for the fourth straight week, the longest rally since Jan. 17.

On the New York Mercantile Exchange, platinum futures for October delivery rose 0.6 percent to $1,480.30 an ounce. Earlier, the price reached $1,487.90, the highest since June 11.

Palladium futures for September delivery advanced 0.8 percent to $842.85 an ounce. The price climbed for the fifth straight day, the longest rally since May 22.

This year, platinum rose 7.8 percent and palladium advanced 17 percent. Supplies were disrupted by a five-month strike by more than 70,000 miners in South Africa. The nation is the top producer of platinum and trails Russia as the biggest source of palladium.

--With assistance from Nicholas Larkin in London.