Daily Gold Update

Source:Market Watch

SAN FRANCISCO— Gold prices rose to five-month highs Monday as the aid package for Greece failed to erase worries about a potential sovereign debt crisis in Europe, though gains were modest as some physical buyers stayed away from the market following Friday's 2.3% rise. Gold for June delivery rose $2.60, or 0.2%, to $1,183.30 an ounce on the Comex division of the New York Mercantile Exchange. That's the highest for a most-active contract since Dec. 3, when bullion pushed past $1,200 to settle at $1,218.30, according to FactSet Research.

"There are still a lot of fears over Greece and the package," said Stephen Platt, commodity analyst with Archer Financial Services in Chicago. "You have to come up with some sort of austerity package [as part of the bailout agreement]. The question is, is the political situation in Greece conducive to put those measures in place?" A bailout package worth some $146 billion for Greece was announced over the weekend, but it wasn't enough to restore investors' confidence about the euro-zone countries and the euro and investors again sought gold as a hedge against currency fears. The euro eased against the dollar after "fears arose that the package may be insufficient to solve the contagion problem and that it will also bring about economic contraction [at least in Greece]," Jon Nadler, an analyst with Kitco Metals, said in a report Monday. See Full Story