Gold Firmly Advances


On Tuesday, gold futures firmly advance, following a strong start at the beginning of the of the third quarter.

In electronic trade, so far gold for August delivery rose $10.20, or 0.8%, to $1,266 an ounce.

On Monday, the yellow metal added $32, or 2.6%, on the New York Mercantile Exchange, bouncing off its dismal performance in the second quarter. Prices slid 23% during the April-June period, marking the worst quarterly decline since modern trading began in the mid-1970s.

A modest improvement in the U.S. economic performance, gains for the U.S. dollar and a sudden spike in U.S. bond yields prompted gold’s price slump in recent weeks.

Barclays on Monday cut its gold-price forecast for this year to $1,393 an ounce, down from its previous outlook of $1,483 an ounce. Analysts commented that additional weakness for gold prices was observed later in the second quarter and this was not what they expected. However, the bank’s forecast remains higher that the current gold price level.

Goldman Sachs, Deutsche Bank, Morgan Stanley and HSBC are among the other banks that have recently downgraded their 2013 price projections for gold and silver.

September silver rose 9 cents, or 0.4%, to $19.66 an ounce, extending Monday’s gain of 11 cents.


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