Gold futures gained in electronic trading Wednesday, taking back a portion of the heavy losses recorded by the precious metal in the New York session.
Gold for February delivery rose $7.70 an ounce to $1,703.50 an ounce Comex division of the New York Mercantile Exchange in Asian trading hours.
The precious metal slumped on Tuesday, falling $25.30, or 1.5%, to a one-month low.
Deutsche Bank strategists aren’t expecting long-term weakness for gold, mainly due to the recent performance of the U.S. dollar.
The strategists said that, if investors were moving to take risk off the table, then such a move would be compatible with a rising dollar.
This has not been a feature of currency markets over the past week, they said.
“We would therefore view the weakness in gold and silver as likely to be short-lived,” they said.
The strategists went on to say that they believed the U.S. dollar could weaken before the end of the year.
Such a move in the U.S. currency would likely be beneficial for gold, as commodities that are priced in dollars — including gold — tend to move inversely with the dollar.
On Wednesday, the ICE dollar index , which measures the greenback against six major rivals, slipped slightly to 79.614, from 79.632 in late North American trading on Tuesday.
Across the wider metals complex, silver for March delivery advanced 33 cents to $33.13 an ounce, while copper for delivery in the same month rose 2 cents to $3.69 a pound.
January platinum advanced $3.90 to $1,586.80 an ounce, and March palladium slipped $1.40 to $681.30 an ounce.
Marketwatch
