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Gold edges up as does euro

Gold ticked up on Friday after reports of police firing on protesters in Saudi Arabia ignited fears of further Middle East unrest

Gulf News


Gold ticked up on Friday after reports of police firing on protesters in Saudi Arabia ignited fears of further Middle East unrest, but bullion was on track for its biggest weekly decline since late January, down more than $20 from a lifetime high hit at the start of the week. Saudi police fired in the air to disperse protesting Shi'ites and three people were injured on the eve of a day of protests called for Friday by activists using the Internet, while protests were planned in other Gulf countries such as Yemen, Kuwait and Bahrain. The time after Friday prayers has proved to be crucial in popular uprisings in North Africa and the Middle East which have brought down Tunisian and Egyptian rulers who once seemed invulnerable. Silver was steady at $35.31 an ounce, having rallied to a 31-year peak above $36 on Monday to track rally in gold and also due to a growing interest in the metal as an alternative investment. Holdings on iShares Silver Trust were unchanged at a record high at 10,974.06 tonnes.


The euro rose on Friday as investors bullish on the currency in the medium term bought it back after a steep slide on Thursday, but it remained vulnerable to a sell-off if a euro zone summit later in the day fails to ease concerns about sovereign debt. For now, however, the single currency remains on an upward bias in the short term on technical charts. But it needs to stay above $1.3777, a touch higher than Thursday's low in order to maintain its bullish momentum. A daily close below $1.3777 would probably push the euro to 1.3591, a 38.2 percent Fibonacci retracement of the January to early March rally. Despite Friday's gains however, the euro is down 1.3 percent so far this week, on track for its worst weekly performance since early January. Euro zone leaders meet on Friday, ahead of a full 27-nation European Union summit on March 24-25, to tackle the region's debt crisis. There was some nervousness before Friday's meeting, but that has since dissipated as investors are not expecting any major announcement that could appease worries about the debt crisis.

Indian rupee

The Indian rupee drifted lower on Friday and was wedged in a narrow band, hurt by choppy domestic shares and weak Asian peers, while traders eyed factory output data due around 0530 GMT for more cues. India's industrial output probably rose to 2.9 percent in January from a year earlier, on higher exports and improved manufacturing sector growth, a median economic forecast showed. Weakness in most Asian currencies may also keep the rupee under pressure. Sterling

Sterling fell to a near two-week low against the dollar on Thursday after the Bank of England kept interest rates on hold as expected, as investors who had bet on an outside chance of a hike cut positions. More downside stops are positioned below the pound's trough hit on Feb. 25 as some investors pare expectations of aggressive rate hikes by the BoE this year. he BoE, which left rates at their record low of 0.5 percent, is widely expected to increase borrowing costs in the coming months, to combat inflation that is running well above target. But investors who were pricing in chances of at least three 2011 rate hikes by the BOE have started to pare back some of those expectations. The BoE made no statement alongside its decision, and the voting pattern will be announced in minutes in two weeks' time. These are likely to reveal a lively debate, given three out of nine policymakers voted for a hike in February.


The yen fell broadly and slumped to a two-week low against the dollar on Friday after a major earthquake struck Japan and triggered a slide in Japanese shares. The dollar climbed to as high as around 83.29 yen, the dollar's highest since Feb. 22, rising from around 82.80 yen on news of the quake, which the US Geological Survey said was measured at magnitude 8.9. Tokyo shares extended their losses, and JGB futures surged after the earthquake. The dollar last stood at 83.15 yen up 0.2 percent from late U.S. trade on Thursday. The euro climbed 0.4 percent against the yen to 114.84 yen.

Source: Richcomm Global Services DMCC, Dubai;