Gold Silver Tips

Gold stayed under pressure in early London trades today as the US dollar continued to have upper hand against the single currency. For the week gold is on track for losses of nearly $25. Crude oil also slipped along with copper and silver due to appreciation in the dollar.

The U.S. dollar continued to move higher on Friday, gaining on disappointment over U.S. data a day prior and as investors watched for news from the European Union summit. The dollar index which tracks the dollar against six major currencies, rose to 79.385 from 79.356 in North American trade late Thursday.

The euro slipped further to $1.3054, from $1.3072 late Thursday. Early Friday, the EU said it has set a deadline of Jan. 1 for agreeing a legislative framework for a single supervisory mechanism. Analysts noted that the dollar was supported by media reports pointing to a public clash between German Chancellor Angela Merkel and French President Francois Hollande over greater EU control of national budgets ahead of the summit a day prior.

Gold for December delivery, the most actively traded contract, shed $7 at $ 1737.7 per ounce on the Comex division of the New York Mercantile Exchange. Yesterday it closed down $8.3 or 0.5 percent to close at $1,744.70 an ounce Thursday on the Comex division of the New York Mercantile Exchange.

Investors were also on alert as a two-day European Union summit got underway in Brussels, although expectations were low for any major developments.

After the first day of the summit wrapped up, European leaders flagged progress in Greece toward meeting its austerity targets but also said that Greece’s institutional lenders were still reviewing the country’s situation.

MCX December gold futures are trading lower at Rs 31356 down nearly Rs 20 per 10 grams. The domestic gold futures have been supported as the Indian Rupee slumped to one month low levels.

The dollar was trading at 53.61 rupees at 0410 GMT after touching 53.79 rupees, its highest level since Sept. 21. It was quoted at 53.41 rupees in late Asian trade Thursday. The local unit was also pressured by weak local stocks, with the Bombay Stock Exchange's Sensitive Index off 0.3% at 18739.20.

The dollar had touched a five-and-a-half month low of 51.36 rupees on Oct. 5, spurred by the U.S. Federal Reserve's third round of quantitative easing and measures taken by the Indian government to reduce spending and boost growth.