Gold futures rallied Friday, as encouraging business-climate data from Germany and other positive news out of Europe bolstered the euro and added pressure on the dollar, making investing in the yellow metal more appealing.
Gold futures for December delivery added $20.20, or 1.2%, to $1,748.50 U.S. an ounce on the Comex division of the New York Mercantile Exchange. Prices shot up as the trading day drew to a close and hovered at their highest in more than a month.
Floor trading was closed Thursday for the Thanksgiving holiday, and most markets, including gold, were on an abbreviated session Friday.
Markets turned to Europe for clues. In Germany, the Ifo Institute said its business-climate index rose to 101.4 in November from 100 in October, topping analysts’ expectations. See: German Ifo index beats forecasts, rallying euro.
General optimism in Europe and the weaker dollar lent support for gold and other assets considered riskier, according to Adam Klopfenstein, a senior market strategist with Archer Financial in Chicago.
The ICE dollar index, which compares the U.S. unit to a basket of six currencies, fell at 80.270 Friday from 80.704 in thin North American trading Thursday.
A weaker dollar is beneficial to gold and other dollar-denominated commodities as it makes them less expensive to holders of other currencies.
Unrest at gold mines in South Africa further affected gold prices. Clashes between union members outside a gold mine owned by Harmony Gold Mining Co. reportedly have resulted in two deaths, stoking fears of production outages. Earlier this year, violent strikes at Lonmin PLC’s UK Marikana platinum mine in South Africa also claimed lives.
Elsewhere in metals, other futures also added to earlier gains. Silver for December delivery rose 62 cents, or 1.9%, to $33.97 U.S. an ounce. Palladium for the same month picked up $15.80, or 2.5%, to $667.50 U.S. an ounce.
January platinum advanced $23.60, or 1.5%, to $1,605.50 U.S. an ounce, while copper for December delivery gained three cents, or 0.9%, to $3.53 U.S. a pound.
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