Gold ends with nearly 2% gain, at 11-week high

By Myra P. Saefong and Barbara Kollmeyer, MarketWatch

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Against this backdrop, the U.S. dollar weakened DXY -0.14% , adding another supportive pillar for dollar-denominated gold prices.

Gold’s rise came in tandem with a swing higher in U.S. Treasury bonds. The benchmark 10-year U.S. Treasury bond 10_YEAR +0.11% rose, with the yield falling to trade about 2.827% compared with 2.888% late Thursday.

Supply and demand

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Physical demand for gold also remained a key factor in the market, with inventories on the Comex continuing to decline, said Mark O’Byrne, executive director at GoldCore in Dublin.

Comex gold inventories totaled 7 million ounces as of Aug. 21.

That equals about $9.79 billion, O’Byrne said. “The total dollar value of the remaining COMEX inventories is a very small amount vis—à—vis assets of many hedge funds, pensions funds and family offices looking to have an allocation to physical gold.”

Skoyles said both silver and gold “remain in high demand across Asia, with several questions being asked about inventory levels and markets under stress.”

In other metals-futures trading Friday, September copper HGU3 +0.69% climbed almost 2 cents, or 0.6%, to $3.35 a pound. It still fell 0.4% for the week.

Among the platinum-group metals, October platinum PLV3 -0.01% added $1.50, or 0.1%, to $1,541.60 an ounce, 0.9% higher than a week ago, but September palladium PAU3 -0.52% ended down $4.20, or 0.6%, at $750.85 an ounce, losing 1.6% for the week.

On the equities front, metals mining shares climbed Friday afternoon. The Philadelphia Gold and Silver index XAU +2.76% was up 3.1%, set for a weekly gain of 2.3%. The gold-backed SPDR Gold Trust GLD +0.11% tacked on 1.7%, up over 5% from a week ago.

Myra Saefong is a MarketWatch reporter based in San Francisco. Follow her on Twitter @MktwSaefong. Barbara Kollmeyer is an editor for MarketWatch in Madrid. Follow her on Twitter @MWBarbaraKollmeyer.

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