Gold Demand Dips Slightly, Silver Prices Rise 1.1%


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U.S. precious metals were mixed Wednesday, as gold and platinum retreated gently while silver and palladium prices rose more than 1 percent.

Worries over the direction of the U.S. dollar and apprehension about what China may do to curb inflation were cited factors for directing gold prices.

"Gold investors are afraid that China is going to put in these price controls to clamp down on inflation and to raise interest rates. So, the news cooled off speculation in the gold market a bit," Donald Selkin, chief market strategist of National Securities Corp, was quoted on Reuters.

New York precious metals closing prices follow:

  • Gold prices for December delivery retreated $1.50, or 0.1 percent, to close at $1,336.90 an ounce. It ranged from $1,330.10 to $1,344.60.
  • December silver prices rose 27.8 cents, or 1.1 percent, to $25.511 an ounce. It ranged between $25.015 and $29.905.
  • Platinum prices for January delivery declined $4.80, or 0.3 percent, to end at $1,640.90 an ounce. It ranged from $1,628.00 to $1,648.00.
  • Palladium prices for December delivery advanced $8.95, or 1.4 percent, to $654.85 an ounce. It ranged between $625.65 and $663.95.

In PM London gold prices, the benchmark gold Fix was $1,337.50 an ounce, down $11.50 from the fixing price on Tuesday.

The US dollar’s rally is "eating into gold’s attractiveness as a substitute holding and prompting some additional long liquidation in the metal," said Jon Nadler, senior analyst at Kitco Metals, Inc. "Pre year-end book-squaring, thinning player participation and ‘window-dressing’ efforts may make the type of volatility in this market a feature to have to live with for the next six weeks."

London silver was off 28 cents to $25.200 an ounce. Platinum was fixed to $1,637.00 an ounce for a loss of $21.00. Palladium was $649.00 an ounce, down $12.00.

Weaker bullion prices in recent weeks have tended to drive up the demand for United States Mint bullion coins. One-ounce bullion American Eagles soared Wednesday.

The Gold Eagle bullion coin jumped 10,500 compared to 2,500 on Tuesday and 9,500 on Monday.

The Silver Eagle bullion coin surged 460,000 versus 250,000 on the previous day and 525,000 on Monday. With Wednesday’s gain added into the mix, November 2010 Silver Eagle sales of 3.175 million are now higher than October 2010 sales which came in at 3.15 million. November is already the fourth best month in 2010 for the .999 fine silver coins. Another 462,000 and they will hold the 2010 monthly record.

The following are the latest U.S. Mint coin sales figures:

U.S. Mint 2010 Gold & Silver Bullion Coin Sales
November 2010 Totals
American Eagle Gold Coin (1 oz) 59,500 1,036,500
American Eagle Gold Coin (1/2 oz) 4,000 43,000
American Eagle Gold Coin (1/4 oz) 2,000 58,000
American Eagle Gold Coin (1/10 oz) 5,000 385,000
American Buffalo Gold Coin (1 oz) Sold Out 209,000
American Eagle Silver (1 oz) 3,175,000 31,805,500


In other gold news, the World Gold Council reported that gold demand rose 12 percent in third quarter of 2010 as compared to the same period in 2009. However, it also indicated that gold demand was down 10% from the second quarter in 2010.

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