FinancialAdvisor's College Class (FACC)

[FinancialAdvisor]

Gold Rises to Near Week's High in London as Dollar Weakens

Gold Rises to Near Week's High in London as Dollar Weakens

March 31 (Bloomberg) -- Gold prices in London rose to near a one-week high as the dollar declined against the euro and the yen, boosting metal's appeal as an alternative to U.S. assets.

``Today will see more dollar watching,'' James Moore, a precious-metals analyst with TheBullionDesk.com, said in an e- mailed report.

The yen headed for its biggest gain against the dollar in three weeks on speculation Japanese companies such as Toyota Motor Corp. repatriated overseas funds on the last day of the financial year. The Japanese currency also got a boost after Bank of Japan Governor Toshihiko Fukui said the economy will return to sustained growth soon.

Gold for immediate delivery rose $1.38 cents, or 0.3 percent, to $427.73 an ounce as of 11:54 a.m. in London. Gold rose 26 cents to its highest close since March 22 yesterday.

The dollar traded at $1.2960 against the euro, from $1.2913 late yesterday in New York, according to the EBS electronic currency dealing system. Against the yen it was trading at 106.86, from 107.55 late yesterday in New York.

The euro rose even after government reports today showed unemployment in Germany rose to a postwar record of 12 percent in March and France's jobless rate held at a five-year high last month, threatening prospects for economic growth in the dozen nations sharing the common currency.

A strike at Gold Fields Ltd. the world's fourth-biggest gold producer, could give gold further ``background support,'' Moore said.

Gold Fields said a strike that started last night at its South African mines halted production as the country's biggest union downed tools over disputes including housing allowances.

South African Strike

The strike could affect about 70 percent of Gold Fields 42,000 workers, as 29,000 of the company's staff are covered by the National Union of Mineworkers. The company normally produces 8,000 ounces of gold a day in South Africa.

South Africa's mining companies pay costs including wages, which make up half of all expenses, in rand and sell metal for dollars. Profits have plunged as the rand more than doubled against the dollar in the past three years.

Among other precious metals for immediate delivery in London, silver rose 7 cents, or 1 percent, to $7.19 an ounce. It earlier touched $7.21, a level not seen since March 21. Platinum advanced 50 cents, or 0.1 percent, to $863 an ounce. Palladium was unchanged at $196.50 an ounce. It earlier touched $198.50, the highest level in more than a week.


LINK: http://www.bloomberg.com/apps/news?pid=10000086&sid=aL7ceItVBiLo&refer=latin_america