PRECIOUS-Gold steadies near $925 as dollar recovers, ETF up

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May 14, 2009 12:01pm NYSE:GLD

3-16-09-gold-125x125TOKYO, May 14 (Reuters) – Gold held steady around $925 per ounce on Thursday as a recovery in the dollar dented sentiment, pushing prices below a six-week high touched the previous day on buying by gold-backed exchange-traded funds.

Despite U.S. and euro zone data suggesting recent optimism about a global economic recovery may have been premature, gold struggled to extend gains as current prices were already seen as high, traders said.

“Gold prices have been stabilising at relatively high levels, slowing fresh investment,” said a senior trader at a Japanese smelter.

“For gold prices to break above recent ranges, there has to be some fresh news about economic turmoil,” he said.

But gains in other commodities such as oil and base metals in recent weeks suggest gold will remain supported, keeping prices in the $915-$930 range for now, the senior trader said.

Spot gold <XAU=> held steady at $924.00 per ounce, down 0.2 percent from New York’s notional close of $925.45. It fell 0.4 percent to a low of $922.20 earlier on Thursday.

On Wednesday, gold rose to a six-week high of $930.40 an ounce as buying by exchange-traded funds and losses in stock markets boosted interest in the metal.

The world’s largest gold-backed exchange-traded fund, the SPDR Gold Trust GLD, said holdings had risen to 1,105.62 tonnes as of May 13, up 1.53 tonnes from the previous business day for the first gain in a month.

Full Story: http://www.reuters.com/article/goldMktRpt/idUSSP5591220090514



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