Gold steadied yesterday after posting its second-largest one-day gain of the month the previous day, boosted by a stronger euro and a recovery in risk assets such as stocks, with which gold is trading more closely than at any time in the last year.
The euro briefly traded at session highs against the dollar after Italy sold three- and 10-year debt ahead of a key meeting of Eurozone finance ministers, which investors hope could result in fine-tuning the details for leveraging the European Financial Stability Facility rescue fund. European equities turned positive, which helped boost gold.
The correlation between the gold price and the Eur-opean stock market is at its most positive, while the correlation of gold and copper is hovering around its highest since the final quarter of 2010 as well, meaning gold is more likely to move in lockstep with these assets. Spot gold was last quoted up 0.16 per cent at $1,714.60 (Dh6,292.58) an ounce by 1208 GMT, having risen from an intraday low of $1,703.25. On Monday, gold gained nearly 2 per cent, marking the second-largest one-day gain this month.