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Gold turns higher on Spanish debt hopes

Published 10/01/2012, 12:56 PM
Updated 10/01/2012, 12:57 PM
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Investing.com - Gold prices climbed higher in U.S. trading  Monday as positive Spanish debt news combined with U.S. numbers to lift the commodity higher on the session. 
  
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery were up 0.26% t0  USD1,778.75 a troy ounce 
  
Gold futures were likely to test support at USD1,755.35 a troy ounce, Thursday's low, and resistance at USD1,785.65, Friday's high. 

Sentiment strengthened after EU Commissioner Rehn said that fiscal consolidation in Spain needs to continue with determination, and that he doesn't expect the country's bank recapitlization to affect the structural deficit. He added that Spain's 2012 deficit target is within reach. 
 

The EU commission is due to give its opinion on Spains's 2013 budget on November 7. 


The comments camed after the Bank of Spain announced Friday that the recapitalization needs of Spanish banks amounted to EUR59.3 billion, broadly in line with market expectations.

However,  investors remained cautious as Moody's rating agency's was to give its latest review of Spain's sovereign rating, which may see it downgraded to junk status. 

 Helping lift shares, the U.S. ISM manufacturing PMI rose more-than-expected last month, industry data showed on Monday.

In a report, the Institute for Supply Management said that the ISM manufacturing PMI rose to 51.5, from 49.6 in the preceding month.

Analysts had expected the ISM manufacturing PMI to rise to 49.7 last month. 
In bearish news, U.S. construction spending fell unexpectedly last month, official data showed on Monday.

In a report, Census Bureau said that U.S. Construction Spending fell to a seasonally adjusted -0.6%, from -0.4% in the preceding month whose figure was revised up from -0.9%.

Analysts had expected U.S. Construction Spending to rise to 0.5% last month.
    
Elsewhere on the Comex, silver for December delivery soared 1.00% and trading at USD34.923 a troy ounce, while copper for December delivery was up 0.53% and trading at USD3.778 a pound.



 

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