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China rate increase delay helps gold

Release Date: 
Monday, December 13, 2010

The price of gold climbed in New York and London on Monday morning as China delayed increasing interest rates, Bloomberg reports. At the same time, European leaders continue pondering the best way to control the debt crisis contagion infecting its nations' banks.

"The ongoing uncertainty over euro zone debt and increasingly inflationary pressures in China create a positive environment to future bullion gains," according to a report by James Moore, an analyst at TheBullionDesk.com in London.

Immediate delivery gold increased 0.4 percent higher in London, reaching $1,391.15 per troy ounce. February-delivery gold increased 0.5 percent to $1,391.90 per troy ounce just before 8 a.m. on the Comex in New York.

As the second-biggest purchaser of gold after India, China mandated its banks to inject more funds into the central bank, representing the third time this has happened since early November.

"Gold is rising along with other commodities as investors buy raw materials in anticipation of even higher prices," Liu Yankgyi, a trader at Beijing Zhong Jing He Investment, told Bloomberg. "The potential for further tightening in China remains a risk."

This news article is independently provided by Brafton and does not represent the views or opinions of Goldline International, Inc. Although the information in this news alert has been obtained from sources believed to be reliable, Goldline does not guarĀ­antee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice.

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†This material has been prepared for private use. Although the information in this commentary has been obtained from sources believed to be reliable, Goldline does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice.

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