Worries Over Greece Exit From Euro Zone Pushes Gold Up $1,200/Ounce, Sales Of Gold Coins In 2014 Drop

By @ibtimesau on
Gold and silver bars and coins are stacked on a table in the safe deposit boxes room of the ProAurum gold house in Munich March 3, 2014. The rising threat of war between Ukraine and Russia sent investors scurrying for relative safety on Monday, pushing st
Gold and silver bars and coins are stacked on a table in the safe deposit boxes room of the ProAurum gold house in Munich March 3, 2014. The rising threat of war between Ukraine and Russia sent investors scurrying for relative safety on Monday, pushing stocks down sharply - the Moscow market fell 11.5 percent - and lifting gold to a four-month high. REUTERS/Michael Dalder REUTERS/Michael Dalder

Prices of gold hit over $1,200 an ounce on Tuesday as investors took to the safe haven yellow metal gold because of worries over Greece's future in the euro zone.

At 0325 GMT, spot gold climbed 0.1 percent to $1,205.40 an ounce. James Gardiner, a MKS Capital trader, told Reuters the uptick was caused by "a bit of talk about safe-haven buying given the spike in uncertainty regarding the future of the euro zone."

Analysts see the climb going to maintain in at least the near-term. Technical analysts from ScotiaMocatta forecast prices of gold could hover and stay at average $1,216 at least for the next 100 days.

Reuters reported holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, on Monday jumped 0.25 percent to 710.81 tonnes in what it regarded as a "sign of improving investor sentiment." Forecast of gold prices could indeed reach the $1,216 average, spurred by the renewed appetite from top consumer China, by virtue of the upcoming Lunar New Year holiday. Demand for the safe-haven yellow metal gold will stay strong and firm until February.

Meantime, the U.S. Mint and Australia's The Perth Mint, some of the world's largest mints, has reported a low record of its gold coin sales for 2014. The Perth Mint said gold bullion coins sold in 2014 were only at 373,351 ounces, a drop of 28 percent from a year ago. Sales of The U.S. Mint's American Eagle coins in the same period declined 39 percent at 524,500 ounces from 856,500 ounces in 2013, its biggest drop since 2006. "Gold prices didn't move a great deal. For us, that meant fewer sales than in previous years," the Wall Street Journal quoted Shane McCulloch, owner of Newcastle Coins in Australia.

But it was the opposite for sales of solid silver coins. Silver-coin sales of the U.S. Mint's alone jumped from 42.7 million in 2013 to 44.0 million ounces in 2014. "The fact is, silver was looking really, really cheap versus gold," Victor Thianpiriya, a Singapore-based commodity analyst for Australia and New Zealand Banking Group Ltd., the Wall Street Journal reported.

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