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Gold rallies despite ETF exodus

Published: 15:40 10 Jun 2015 BST

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Gold belatedly rallied on the downturn in the US dollar despite more sales through exchange traded funds.
Spot gold was trading more than US$12 higher at US$1,188 shortly after Wall Street opened as the EU rejected as insufficient yet another set of proposals from the Greek government to restructure its economy.
Greece has to pay €1.6bn to another of its lenders, the IMF, at the end June, which economists suggest is fanciful unless the EU relents.
The concerns brought some respite for gold, with metal under pressure since last week’s non-farm payroll report, that raised concerns over US interest rate rises
A steady outflow from gold ETFs has become a more persistent source of weakness and a further 3.7 tons was withdrawn yesterday making 13 tons already this month.
In particular, SPDR Trust, the largest of the gold-backed ETFs, saw holdings fall to their lowest since January.
“For as long as the outflows continue, we believe it is unlikely that the gold price will make any significant gains,” said Commerzbank.
Silver rallied with gold and was back above US$16 again, while platinum gained US$9 to US$1,113.
 
Major movers
Randgold Resources up 37p to 4,689p
Fresnillo up 21p to 736p
Anglo American up 28p at 1,014p

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