Gold jumps as dollar eases on Greece aid agreement

11:24, March 27, 2010      

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Gold futures on the COMEX Division of the New York Mercantile Exchange ended much higher on Friday, as dollar softened against euro after a meeting of European leaders on Thursday that developed an emergency bailout plan to help Greece. Sliver rose, but platinum declined.

The most active gold contract for April delivery rose 11.4 U.S. dollars, or 1 percent, to finish at 1,104.3 dollars per ounce.

European leaders met on Thursday at a summit and finally agreed on a bailout plan combining EU and IMF loans that could be used to rescue the Greek economy and keep its financial crisis from spreading across Europe.

Although the bailout plan can only be used as a last resort, and needs unanimous agreement of all eurozone members, the hard- won deal provided the euro with some relief by sending a positive signal to the market that European countries are willing to provide a safe net for Greece when it needs.

The euro rebounded from a 10-month low against the U.S. dollar. The weak performance of dollar lifted gold, since it made the precious metal more attractive as a hedge.

Meanwhile, a report released on Friday showed the U.S. consumer sentiment in March had improved, and the better-than-expected results made investors feel confident about economic prospects, also helping gold price to inch higher.

May silver was up 16.5 cents to 16.906 dollars per ounce. April platinum dropped 10.4 dollars to 1,596 dollars an ounce.

Source: Xinhua
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