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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Rarebird who wrote (38862)	8/12/1999 8:14:00 AM
From: john mcknight	Read Replies (1) \| Respond to of 116768

Thursday August 12, 7:11 am Eastern Time Gold cracks $260 barrier, nears UK auction price LONDON, Aug 12 (Reuters) - Gold cracked resistance at $260 an ounce during early European business, buoyed by a range of buyers, to levels last seen the day of Britain's 25-tonne gold auction, dealers said. London gold fixed at $260.20 a troy ounce in the morning, well up on Wednesday afternoon's $257.75, its highest since the UK's July 6 sale. Britain got $261.20 an ounce for its gold before bearishness about the lack of big bids above the market plunged prices to end the day of the auction near $257.00. Prices struck fresh 20-year lows later that month before its latest recovery. ``There's been some trade house buying around this morning, no one in particular,' said one London dealer. ``We got above the New York high and near the UK auction price before the selling came in,' he said, putting at 50/50 the market's chances of further gains. Nearby resistance stood at $261.20 and the auction day high above $262.00, the dealer added. Short covering helped ease what has been unusually sustained tightness in gold lease rates, with some dates dropping up to 10 basis points on Wednesday's levels. Implied lease rates for one-month gold fell six basis points to 2.74 percent while those for a year were down 10 at 3.49. Tight lease rates make positions less profitable for short sellers, price hedging miners and bullion banks by reducing the usual premium between gold rates and those for money. ``With this fund buying, we will see the forwards easing again which is good. A few banks were panicking with their five-year and seven-year hedging agreements with producers,' said one German dealer. Rates have been higher since May, when Britain announced plans to sell 415 tonnes from reserves of 715 tonnes during the coming years with five offerings of 25 tonnes every other month until March. The next sale is on September 21. Spot gold was last quiet at $260.20/$260.70 versus Wednesday's New York close of $258.70/$259.20. Rallies in both gold and base metals helped silver rise late on in New York trade but proved of no help when they resumed on Thursday, when silver held fast. The metal was last a cent higher at $5.38/$5.41 while platinum was 50 cents down at $351.00/$353.00 and palladium was unchanged at $340.00/$345.00. --------------------------------------------------------------------------------