Gold Seesaws on Currency Worries
Source: Reuters, Amanda Cooper (5/16/11)
"Twin forces of deepening concern about eurozone debt and the growing strength of the dollar offset each other."
Gold steadied on Monday, as the twin forces of deepening concern about the euro zone debt crisis and the growing strength of the dollar offset each other, while investors kept silver pinned near last week's 2-1/2 month lows.
The euro slid to a seven-week low against the dollar after IMF Chief Dominique Strauss-Kahn, a key voice in euro zone debt talks, was charged with sexual assault, increasing uncertainty on aid for Greece and other indebted euro zone countries.
The dollar index .DXY, a measure of the greenback's strength against a basket of currencies, advanced to its highest since early April. [USD/][ID:nN15215355]
Spot gold XAU= was little changed at $1,494.49 an ounce by 0838 GMT, after ending flat in the previous week. Prices had fallen by about 5 percent from the lifetime high of $1,575.79 hit on May 2.
U.S. gold GCcv1 was nearly unchanged at to $1,494.50.
"The dollar is coming into some safe-haven bids, with all the uncertainties and the turmoil and there's maybe a reassessment that we'll see the dollar aggressively firm," said Credit Agricole analyst Robin Bhar.
"So it's dollar strength and possibly euro zone jitters."