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Gold advances for first time in three days on US retail sales
[NEW YORK] Gold futures rose for the first time in three days as US retail sales in January fell more than forecast, signaling a cooling economy and increasing demand for the precious metal as a haven.
The 0.8 per cent drop in retail sales followed a 0.9 per cent decrease in December, government data showed Thursday. The median forecast of economists surveyed by Bloomberg called for a 0.4 per cent decline. Gold also gained as applications for unemployment benefits climbed more than forecast, Labor Department figures showed.
The metal rose 8 per cent in January, partly as a decline in global equities boosted demand for alternative assets. Holdings in exchange-traded products backed by gold have advanced 4.9 per cent this year amid turmoil in currency markets.
"The weak US data in retail sales, especially core retail sales, and the jump in jobless claims above 300,000 has pushed gold modestly higher," Tai Wong, the director of commodity products trading at BMO Capital Markets Corp in New York, said in a telephone interview. "On the margin, it pushes back the time line" for the Federal Reserve to boost interest rates, he said.
Gold futures for April delivery rose 0.2 per cent to US$1,222.10 an ounce at 10.33 am on the Comex in New York. The price dropped 1.8 per cent in the previous two sessions. Through Wednesday, the metal advanced 3 per cent this year.
Euro-region finance ministers failed to reach an agreement on how to keep funds flowing to Greece and are set to resume talks next week. The impasse risks leaving the region's most- indebted nation without funding by the end of this month, when the current bailout expires.
The dollar fell as much as 0.9 per cent against a basket of 10 currencies. On Wednesday, the gauge reached the highest since at least December 2004.
Silver futures for March delivery gained 0.1 per cent to US$16.78 an ounce.