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Gold boosted as euro rallies further

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Gold moved ahead again as the euro maintained its recent good performance against the US currency.

Spot gold added US$11.60 to US$1,669.11 with silver also notching up good gains, though it was platinum that topped the precious metal performers after strong export figures from China buoyed hopes for industrial demand.

Silver added US$0.386 to US$30.73, while platinum gained US$19 at US$1,614.

Gold has made steady progress this week following the weakness of the dollar against the European currency.

Comments today by Mario Draghi, the ECB president, that the Eurozone would return to growth this year kept the euro in demand.

He also said that today's decision to keep interest rates in the Eurozone unchanged was unanimous, scotching suggestions that could be a further rate cut soon.

Gold, which traditionally moves in the opposite direction to the dollar, has now made up a good chunk of the ground lost when it tumbled to a four-month low as minutes from the US Federal Reserve indicated concerns about the side effects of its huge monetary easing programme.

Elsewhere, there were good gains for sector leader Randgold Resources, even though RBC Capital markets trimmed its target price following the recent fire at the Tongon mine in the Ivory Coast.

RBC said that while the mills at Tongon are working again, recoveries are likely to be lower as the flotation circuit is brought back on on-line, which will impact first quarter production and costs.

Because of this, the broker has reduced its target price to £69 from £74 though it added that its longer term buy case remains intact.

 

Major movers

Rangdold Resources (LON:RRS) up 112.5p at 5,973p

African Barrick Gold (LON:ABG) down 16p at 364p

 

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