Gold slipped below US$1,100/oz, settling at US$1,097/oz today after the US dollar extended gains against the euro amid uncertainly over Greece’s fiscal crisis as Germany is still at odds with European Union commissioners and other euro zone countries over the possible aid package for the debt laden country.
German Chancellor has reiterated her stance that Greece does not require an EU bailout, referring to comments by Greek Prime Minister George Papandreou, who has said that Greece was not looking for financial aid, but rather for regulatory changes to prevent its ongoing debt crisis from exacerbating and spreading beyond the euro zone.
Leaders of other EU states including France and Italy supported the European Commission’s President Jose Manuel Barroso, who has called on EU countries to put together an aid package for Greece ahead of this week's EU summit.
Public opinion polls in Germany have shown strong opposition to the country’s participation in a bailout for Greece.
Greece’s debt problems that have been pushing down the euro and other factors including India’s unexpected interest rate hike and China’s rising inflation rate have been weighing on gold, keeping the yellow metal around the US$1,100/oz mark.
Other precious metals also retreated. Silver slid to US$16.82/oz, while platinum dropped to US$1,593/oz.
All major miners were on the rise today. Platinum producer Lonmin (LSE: LMI) was in the lead with a 2.3% gain. Gold producer Randgold Resources (LSE: RRS) followed with a 1.2% advance, while silver miner Fresnillo (LSE: FRES) posted a marginal gain.
Specialty chemicals firm Johnson Matthey (LSE: JMAT) also added less than 1%.
Silver producer Hochschild Mining (LSE: HOC) was the top performer among the midcaps, advancing 3.5%. Aquarius Platinum (LSE: AQP) tacked on 1.9%, while gold miner Petropavlovsk (LSE: POG) rose 1.3%.
Uzbekistan focused gold miner Oxus Gold (AIM: OXS) was one of the leading performers among the small caps, rising 6%. Argentina focused gold explorer Patagonia Gold (AIM: PGD) and Turkey focused gold miner Ariana Resources (AIM: AAU) climbed 4.5% and 4% respectively.
Fiji focused gold miner Vatukoula Gold Mines (AIM: VGM) slipped 5%, while South American based explorer Mariana Resources (AIM: MARL) and Philippines focused Metals Exploration (AIM: MTL) lost 3.5%.