Gold price continues uptrend on downbeat U.S. economic data

11:41, October 31, 2010      

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Gold futures on the COMEX Division of the New York Mercantile Exchange extended its rally for the second session on Friday, after a gauge of consumer sentiment dropped and third-quarter U.S. economic growth fell short of expectations, enhancing gold's appeal as a safe haven. Silver also posted strong gains.

The most active gold contract for December delivery climbed 15. 1 dollars, or 1.1 percent, to finish at 1,357.6 dollars per ounce.

The U.S. Commerce Department announced on Friday that the country's gross domestic product climbed at an annual rate of 2.0 percent during the third quarter, which is higher than the 1.7- percent growth in the previous quarter, but still failed to reach economists' forecast of 2.1 percent, indicating the economic recovery is too slow to help reduce the high unemployment rate.

Meanwhile, the Thomson Reuters/University of Michigan consumer- sentiment index dropped from 68.2 in September to 67.7 in October, also giving a strong boost to the bullion, which started soaring after the report was released.

Investors usually purchase the precious metal as a safe haven in times of economic turmoil. Meanwhile, most investors have been waiting for the results of a two-day meeting of the U.S. Federal Reserve next week for clear direction in the gold market.

December silver soared 68.9 cents, or 2.9 percent, to 24.564 dollars per ounce. January platinum rose 15.1 dollars, or 0.9 percent, to 1,707.1 dollars per ounce.



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