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Gold jumped out of a tight trading range at the start of New York dealing On Friday and rose to 0.5% weekly gain at $1227/ounce as investment moved into “safe haven” assets because of the news of a sharp drop n US retail sales.

Gold’s price in Euro and Sterling also reversed the week’s near 2% drop and jumped above €32,600 per kilo and £844/ounce.

According to a note from Walter de Wet at Standard Bank, the gold market was very quiet after profit taking. However, there was a buying interest on dips which pegged support for the price of gold at $1210 with resistance at $1228.

According to Citigroup analyst David Thurtell, gold is likely to encounter repeated resistance at $1250 mark over the coming month. He also added that the seasonal period for buying in India is upon us, which will take some of the heat out of the market.

Consumer gold demand remained weak for the fourth day running according to the Economic Times of India. However, Mumbai dealers noted that the prices have eased because of the strengthening Rupee.

The price of gold traded marginally lower by Rs 6 or 0.03% to Rs 18,863 per 10 gms in futures trade on Thursday on fresh selling by traders which were affected by a weakening global trend.
Some investors sold gold to lock in gains after it climbed to its record high and haven demand fell after Japan raised an estimate for growth. As a result, gold declined in Asia leading to a weakened trading sentiment. In addition, gold also fell 0.3% to $1,229.38 an ounce in the Asian region.

The fresh selling of traders in tandem with a weakening global trend affected the price of gold to trade slightly lower at futures trade according to marketmen.
Gold futures marginally down on lower global trend- Hindustan Times:

The price of gold fell for the second straight day as the euro’s rally reduced the demand for gold as a safe haven.

The euro rose as much as 1.3% against the dollar after a German court rejected a bid from a lawmaker to block the nation from participating in the eurozone rescue fund.

Gold futures for delivery in August fell 0.6% or $7.70 to $1,222.20 on the Comex. Gold also fell 1.3% yesterday while the euro rose for the third straight day as the ECB kept its main interest rate at 1%, a record low.

During this year, gold has increased by 11% while the euro slumped 15%.

Gold Prices Decline for Second Straight Day as Euro Advances – BusinessWeek

UK bullion dealers are struggling to provide enough gold sovereign and Britannia coins to keep up with surging demand ahead of an expected increase in capital gains tax in the new government’s budget on June 22. Dealers are reporting a backlog of orders for bullion coins recognized as UG legal tender, exempted from CGT.

According to the managing director of gold dealer Baird and Co Anthony Baird, the company cannot deliver any Britannia coins until August due to lack of supply.

In addition, the supply situation is worse from overseas sources because European sales onto the market of coins and other forms of investment bullion are particularly in a slack

Investors are storing gold because of the eurozone debt crisis. Gold prices highs were also recorded on Tuesday in dollar terms above $1,250 per ounce and have also reached highs in euros, sterling, and Swiss francs because of economic uncertainty. This means that fewer coins are coming back in the market.

UK dealers struggle to meet gold coin demand | Reuters

Gold’s price has surged to a record high above $1250/oz yesterday as worries about the scope of the eurozone debt crisis and its effect on recovery pushed investors towards the perceived safety of gold.

After Fitch’s comment that Britain’s deficit challenge was formidable, The European stocks fell for the third day and the pound weakened.

According to GFMS CEO Paul walker, gold is expected to trade between $1050/oz and $1300/oz for the rest of 2010 and it may also rise to $2000/oz if the sovereign crisis spread beyond Europe. It may even surpass the platinum price.

In the early evening, gold increased to $1254.50/oz in New York and also reached highs in sterling, euros, and Swiss francs. Throughout the year, it has gained 13% because of investors losing trust and confidence in currencies.

BusinessDay – Europe debt crisis drives gold price to fresh high:

Gold in Mumbai has hit a new record high of Rs 18,983 per 10 gm last Saturday and up 2.2% from Friday’s close after taking cues from overseas gold which on Friday rose by $23 to $1219.9 an ounce, because of speculations about the debt crisis in the eurozone spreading to Hungary.

The euro had its lowers level in more than four years on Friday where it was at 1.19/dollar from 1.21 on June 1. The Dow fell below 10,000 points last Friday over a poor US jobs report and Hungary’s debt crisis.

According to Rajesh Mehta, the chairman of Rajesh Imports, gold could have a shy at the Rs 20,000 per 10 gm mark if the dollar kept up its rally against the other currencies.

Because of economic instability and uncertainty and other commodities being in the slump, investors are moving to the safety of the dollar and gold. Gold’s price in rupees however, is rising. This is because of the rupee’s depreciation versus the dollar more than any fundamental reason such as increased demand.

Gold soars to new high of Rs 18,983-Bullion-Markets-The Economic Times:

The price of gold increasing in the international market and the drop of euro against major currencies has affected bullion market domestically as the prices has reached Rs 39,550 per tola after increase of Rs 950 per Tola on Tuesday.

This increased was witnessed after the price of gold hit a record high level of $1,252.80 per ounce in the international market after increasing $35 per ounce.

According to Shafi Choksi, the Director of Pakistan Gems and Jewellery Development Company (PGGDC), the uncertain returns on securities and new entrants in the gold market have pushed its price at record high level in the international as well as domestic markets.

The demand for physical gold also picked up in Asia even though the prices have discouraged consumers throughout the year.

Record investment demand could take gold prices to all time highs in 2010 and there is a good chance gold could rise to $1,300 this year or next with further investor-led price gains. In addition, as there are worries about the global economy, gold is seen as a safe haven by investors.
Daily Times Pakistan – Gold price hits record high:

The sale of pure gold jewellery is expected to drop significantly as the prices of the gold increases steadily on the back of the eurozone crisis and economic instability.   Gold reached a record of Rs 19,000 per 10 gram in New Delhi last Tuesday.  However, jewellery retailers indicated that hardening prices would deter consumers to purchase pure gold, leading to a drop in volumes.  Instead, a robust increase in diamond jewellery could be expected in the coming months.   According to Bachraj Bamalwa, The All India Gems and Jewellery Trade Federation Vice-Chariman, sales of pure gold jewellery has been flagging because of rising prices, but the renewed spike in the value of the metal could translate into another 15% drop in sales volumes.  He also added that prices could rise further and may reach Rs 22,000 per 10 gm by the end of the year.   As the rise in prices of gold continues, consumers might settle for cheaper options.  Even exports are seen to suffer if the trend continues.

According to Castlestone Managments’ CEO Angus Murray, gold’s price will reach $2,400 in the next decade.  Gold will also benefit continuously from the current economic market woes, especially in the eurozone countries.

According to Murray, gold will move to trade in a range of $1,400 to $1,600 and it’s effectively doing this now.  He further added that in their view, gold will continue to benefit from the combination of reaching a new high in euro terms, sliding global equities, the situation in Greece, the ECB’s reluctance to buy Greek bonds, and soaring demand for gold bars.

Precious metals continue to be insurance in a diversified portfolio and acts as a safe-haven asset in economic turmoil.  In addition, EPFR figures also suggest that gold continues to be at the top of the list for investors.

Gold price tipped to hit $2,400 | Fund Selector | Citywire:

According to city jewelers in India, gold in the long run, will invariably remain in demand and anything under the sun can fail except gold.  They still believe in this even though they have witnessed a slight fall in rupee as well as the willingness of customers to buy gold.

The price of gold (99.5 purity) has reached a record breaking Rs 18,900 per 10 grams last Wednesday with a virtual 25% appreciation from 2009, where the price was expected to be in Rs 13,000.

In addition, the World Gold Council recently said that gold demand in India will continue to grow.  Mukesh Jain, a broker, said that due to a volatility in the global and currency markets, the price of gold is expected to touch the Rs 22,000 mark.  He added that he has been investing in gold ETFs and investment into paper gold saves investors the hassle of storage.

The gold’s demand however primarily differs from people belonging to different classes of society.  For instance, upper class invest in gold regardless of the price, while middle and lower classes stay away from buying gold unless there is a marriage in the family.

India Times: