Gold futures climbed Friday, poised for a weekly gain, as concerns over U.S. fiscal health and euro-zone economies prevailed, and investors bet on strong demand out of India.
Gold for December delivery was up $7.20, or 0.4%, to $1,733.20 U.S. an ounce on the Comex division of the New York Mercantile Exchange.
U.S. data Friday were a bit encouraging The preliminary reading of the University of Michigan/Thomson Reuters consumer-sentiment index rose to 84.9 in November, from a final October reading of 82.6.
Commerzbank analysts, in a Friday report, also highlighted strength in gold demand in China.
"Chinese demand for gold is set to grow by 1% this year [to a record] 860 tons on the back of increased jewelry demand and growing investment demand," the firm’s analysts said, citing Thomson Reuters GFMS data.
Commerzbank analysts also said a supply crunch in South Africa as well as concerns about inflation in the euro-zone also provided support for gold.
In September, gold-mining production in South Africa dropped 11% from the year-earlier month, partly because of strikes, the analysts said.
Meanwhile, European Central Bank President Mario Draghi’s remarks on Thursday that the unveiling of the institution’s yet-to-be-implemented bond-purchase program has helped stabilized the monetary union, "thus increasing the expansionary degree of monetary policy. This is likely to spark concerns about inflation and keep demand for gold" high, they said.
Gold futures closed higher on Thursday after the ECB affirmed its current monetary policy and as investors worried about if and how the U.S. will resolve the so-called fiscal cliff. That’s the series of mandated spending cuts and tax increases that would take effect if the government can’t resolve its budget differences.
Gold futures last Friday slumped more than $40 an ounce after a U.S.- government jobs report came in stronger than expected. The metal closed that day at $1,675.20 U.S.
Silver prices followed gold higher and platinum futures also found support, but other Comex metals were lower.
Silver for December delivery rose 36 cents, or 1.1%, to $32.60 U.S. an ounce, with futures prices trading about 5.6% higher for the week.
Platinum for January delivery jumped $26.60, or 1.7%, to $1,569.10 U.S. an ounce. Prices are up more than 1% from a week ago.
December palladium moved down by 80 cents, or 0.1%, to $613.55 U.S. an ounce, trading more than 2% higher for the week, and December copper was at $3.44 U.S. a pound, down three cents, or 0.9% for the session, set for a more than 1% loss on the week.
