Sept. 7 (Bloomberg) -- Gold may rebound after falling the most in a week yesterday as investors sought to protect their wealth against declining currencies and economic turmoil.
Gold for immediate delivery was little changed at $1,874.80 an ounce at 8:52 a.m. in Singapore. It fell 1.3 percent after touching a record $1,921.15 yesterday as the Swiss central bank set a ceiling on the exchange rate, strengthening the dollar for a sixth day against a six-currency basket including the franc.
The move is ultimately “bullish for gold as it reduces the number of safe haven currencies available to investors,” said HSBC Securities USA Inc. analyst James Steel. December delivery futures in New York rose 0.2 percent to $1,877.10 an ounce, after reaching a record $1,923.70 yesterday.
The Swiss franc weakened the most ever against the euro after the central bank said it will defend the minimum rate target on the currency with the “utmost determination.” U.S. stocks extended a global rout on concern the European debt crisis is worsening. German Finance Minister Wolfgang Schaeuble said Greece won’t get its next bailout installment unless it meets goals under the aid package.
“What’s going on in Europe right now, we’re going to have to come up with another half a trillion, or maybe a trillion dollars to back the banks,” Robert Lutts, president of Cabot Money Management, said in a Bloomberg Television interview. President Barack Obama in a Sept. 8 address is “going to talk about new fiscal programs and new costly programs for our government. The debt explosion’s just beginning,” he said.
Obama plans to propose boosting job growth by injecting more than $300 billion into the economy next year mostly through tax cuts and infrastructure spending. Data last week showed the U.S. jobs market stalled in August.
Platinum for immediate delivery was little changed at $1,854 an ounce, trading below gold for a third day. Cash silver was also little changed at $41.9950 an ounce and palladium rose 0.3 percent to $754.50 an ounce.