Gold off 6-week low on fears of Greek default

Singapore: Gold regained some ground on Wednesday, after falling 2 percent in the previous session as worries about a possible Greek default resurfaced, but dealers expected bargain hunters and jewellers to snap up the metal at current levels.

Spot gold hardly changed at $1,673.86 an ounce by 0025 GMT after hitting a high at $1,675.50. It had dropped as low as $1,663.95 on Tuesday, its weakest since January 25. US gold for April delivery rose $2.50 to $1,674.60 an ounce.

Athens turned up the heat on its creditors on Tuesday as it sought to secure a bond swap that will cut its mountainous debt, while the main bondholders group warned a disorderly default would cause more than a trillion euros of damage to the euro zone.

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Hong Kong shipped 32,948 kg of gold to mainland China in January, down 15 percent from the previous month, the Hong Kong Census and Statistics Department said on its website, reflecting slower sales during the Lunar New Year holiday.

Commodity currencies like the Australian dollar nursed heavy losses for a second session in Asia on Wednesday, while the euro also looked wobbly as renewed worries about Greece hit a market already fretting over China’s slower growth target.

Japan’s Nikkei share average fell 1.1 percent in early trade on Wednesday on fresh concerns over slowing global growth after Brazil reported weak growth for 2011 and fears that Greece may not meet its deadline for debt restructuring.

Oil prices retreated on Tuesday as data showing a shrinking euro zone economy fueled fears of curbed demand for petroleum, while news that major powers accepted Iran’s offer for more talks on its nuclear program eased concerns about supply disruptions.

Reuters