Gold prices declined this afternoon as the US dollar – which has an inverse relationship with the yellow metal - advanced after falling sharply at the end of last week.
Demand for the safe-haven greenback was dampened by reassuring statements from European leaders including a joint statement from German Chancellor Angela Merkel and French president Francois Hollande.
The leaders of the euro zone’s two largest economies said they would do what’s necessary to prevent the monetary union from falling apart, fuelling speculation that the European Central bank (ECB) may unveil further stimulus measures this week after cutting the interest rate at its previous meeting.
Their statement followed comments from ECB president Mario Draghi, who said the central bank would do all in its powers to save the euro.
The euro rallied against the greenback late in the week, but pulled back today as investors sold the single currency to take profits.
Additionally, the euro was hit by concerns that the ECB will announce more stimulus measures as soon as next week as some commentators suggested it may take a few weeks for the bank to take more stimulus action.
Gold traded at US$1,620/oz this afternoon, down US$3 from Friday’s close. Platinum was headed in the same direction as gold, dropping US$4 to US$1,403/oz, while silver added 24 cents to reach US$28.03/oz.
Today’s top risers in the sector were:
Condor Gold (LON:CNR), up 10 percent at 119 pence at midday
Minera IRL (LON:MIRL), up 9.5 percent at 44.7 pence
GoldStone Resources (LON:GRL), up 8 percent at 4.2 pence
Angel Mining (LON:ANGM), up 7 percent at 1.1 pence
Shanta Gold (LON:SHG), up 6.5 percent at 25 pence
The top fallers were:
Ariana Resources (LON:AAU), down 27 percent at 1.54 pence at midday
Oxus Gold (LON:OXS), down 21 percent at 2.53 pence
SolGold (LON:SOLG), down 7.5 percent at 3.93 pence
Mariana Resources (LON:MARL), down 5.5 percent at 4.25 pence
Trans-Siberian Gold (LON:TSG), down 4 percent at 48 pence