Gold ends modestly higher while silver ends marginally lower
Yellow metal prices ended modestly higher on Wednesday, 08 August 2012. Prices rose amid range-bound trading. The market place is quieter this week amid a lack of fresh, major news. Prices managed to eke out gains amid rising dollar as they garnered support from positive U.S. productivity data and expectations of additional monetary stimulus. Silver ended marginally lower.
Gold for December delivery rose $3.2, or 0.2%, to end at $1,616 an ounce on the Comex division of the New York Mercantile Exchange on Wednesday.
On Wednesday, silver prices for September delivery fell 1 cent (0.01%) to end at $28.08.
In the currency market on Wednesday, the dollar index, which weighs the strength of the dollar against a basket of six other currencies, rose by 0.24%.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa. But bullion metals have registered increase in prices despite strong dollar in recent times and vice versa.
Latest data at Wall Street showed that U.S. productivity rebounded in the second quarter, posting a solid gain as companies generated more goods and services even though there was little change in the number of hours their employees worked. The Labor Department said on Wednesday that productivity rose 1.6% in the April-to-June period, a sharp contrast to the first quarter's revised decline of 0.5%. Market had expected productivity to climb by 1.3%. Productivity measures the goods and services generated by an economy.
The increase in second-quarter productivity was spurred by a 2% gain in the amount of goods and services produced, known as output, and a much slower 0.4% increase in hours worked. Productivity rises when output increases faster than the amount of hours workers spend on the job. The number of hours worked slowed considerably in the second quarter from the 3.2% increase in the first three months of the year.
At the MCX, gold prices for October delivery closed higher by Rs 129 (0.43%) at Rs 29,896 per ten grams. Prices rose to a high of Rs 29,919 per 10 grams and fell to a low of Rs 29,783 per 10 grams during the day's trading.
At the MCX, silver prices for September delivery closed higher by Rs 41 (0.07%) at Rs 53,409/Kg. Prices opened at Rs 53,399/kg and rose to a high of Rs 53,620/Kg during the day's trading.
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