Gold advanced the most in two weeks as the dollar dropped for the fifth straight session, increasing demand for the precious metal as an alternative investment.
The Bloomberg Dollar Index, a gauge against 10 major trading partners, fell as much as 0.5 percent, heading for the longest slide since April. Exports rebounded in China, signaling improving economic growth in the world’s biggest bullion buyer after India.
“The continued weakness in dollar is making gold look attractive,” Frank Lesh, a trader at FuturePath Trading in Chicago, said in a telephone interview. “Also, there is some buying in anticipation of a rise in retail Chinese demand as the economy improves.”
Comex gold futures have increased overnight gains to trade solidly higher and push back above the key $1,300.00 level in late-morning dealings Thursday to over $1310 on the Comex December contract. Heavy short covering following the recent selling pressure is featured, along with some bargain-hunting buying interest. The weaker U.S. dollar index that hit a six-week low Thursday is also helping to boost the gold market.
