Gold may decline in London as the Arab League’s announcement that it’s studying ways to end the crisis in Libya prompts some investors to sell the metal following its rally to a record.
Gold reached a record $1,440.32 an ounce yesterday. An Arab League official said the group has consulted with Venezuela on the plan. Libya’s Muammar Qaddafi and Venezuelan President Hugo Chavez have discussed resolving the crisis, the Associated Press reported. Bullion gained the previous four days.
Reports “Venezuelan President Hugo Chavez has offered to broker a peace deal,” pressured gold, James Moore, an analyst at TheBullionDesk.com in London, said in a report. “There is scope for further profit taking, particularly if tomorrow’s non- farm payrolls help reinforce the drop in the jobless rate last month. We expect dips to be viewed as buying opportunities.”
Immediate-delivery bullion fell $3.13, or 0.2 percent, to $1,431.38 an ounce at 9:10 a.m. in London. Gold for April delivery was 0.4 percent lower at $1,431.40 an ounce on the Comex in New York, after yesterday touching a record $1,441.
Concern about rising inflation and currency debasement drove gold prices up 30 percent last year for a 10th annual gain. Asian countries from China to Indonesia raised interest rates this year to curb rising consumer prices. Increasing food and commodity prices have contributed to unrest that started in Tunisia in January and spread to Egypt, Bahrain, Iran and Yemen.
Oil surged yesterday on concern the turmoil curbing exports from Libya will spread to the Middle East, disrupting more supplies. Qaddafi’s warplanes bombed rebels as his ground forces fought unsuccessfully for a main Libyan oil port and opposition leaders appealed for foreign nations to launch airstrikes against regime mercenaries.
U.S. employers added 195,000 jobs last month, the most since May, according to a Bloomberg News survey of economists before tomorrow’s Labor Department report. A report yesterday from ADP Employer Services showed U.S. companies added more workers in February than forecast by economists.
Silver for immediate delivery was down 0.1 percent at $34.635 an ounce after yesterday climbing to $34.985, the highest price since March 6, 1980. That year the metal reached a record $50.35 in New York.
Palladium was unchanged at $820 an ounce. It touched a 10- year high of $862.25 on Feb. 21. Platinum was 0.5 percent lower at $1,840.20 an ounce.