Int'l gold gains as Europe debt concern spurs demand

Concern over Europe's debt crisis deepens, spurs demand for gold as protection of wealth

Gold  today climb for a second day as concern over Europe's debt crisis is deepening spurs demand for the metal as a protection of wealth.

Gold rose 0.3% to $1,593.50 an ounce. Silver was little changed at $27.42 an ounce.

The euro neared a two-year low versus the dollar earlier today as reports showed industrial output shrank in France and exports and imports growth slowed in China, adding to concern Europe will struggle to avoid a recession.

European governments will jump-start as much $123 billion in emergency loans to shore up Spain's banks and may move the costs off the Spanish government's balance sheet to shield the euro region's fourth-largest economy from the debt crisis.

 

The metal is up 1.7% this year after 11 consecutive annual gains. Gold-backed exchange-traded product holdings declined 3.5 tonne to 2,409.2 tonne, within 0.2% of the record reached on July 5.

The World Gold Council reduced its target for Chinese gold demand this year to 870 tonne from a previous estimate of 1,000 tonne as a stronger dollar weighs on consumption.