Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold dipped 10 cents to close at $1,201.90, holding virtually all of yesterday's 2.1% surge as concerns about Greece offset a stronger dollar to reinforce demand for safe havens.

With their country edging closer to default, Greeks pulled 1.2 billion euros from banks today and 4.2 billion this week, worried that the banking system could collapse. While the ECB raised the limit on Emergency Liquidity Assistance to keep the banks afloat, depositor panic took hold nonetheless after an ECB official said yesterday that Greece's banks might not open next week.

The dollar strengthened and U.S. Treasury bonds rallied alongside gold on flights to safe. U.S. equities fell back on risk-aversion, with the Dow and S&P 500 surrendering around 0.5%.

Gold finished the week 1.9% higher for its second straight weekly rise, boosted by this week's FOMC policy statement indicating that interest rates may rise later and more slowly than previously thought. Low rates benefit gold and other commodities by holding down the dollar, making them less expensive to international buyers.

The other precious metals were mixed on the day and week. Silver slipped 0.3% but still gained 1.8% this week. Platinum added 0.4% but lost 0.9% on the week. Palladium fell 1.6% today and 4% this week.

At the Comex close: August gold dipped 10 cents to $1,201.90; July silver slid 4 cents to $16.11; July platinum added $4, to $1,086.80; and September palladium dropped $11.25 to 707.40 an ounce.