Gold prices were edging higher again Tuesday as gloomy economic reports added to the allure of the metal, which has been on a tear in the first days of 2008.
February-dated bullion contracts were ahead by $5 at $908.40 an ounce in recent action on the Comex division of the New York Mercantile Exchange. On Monday, prices reached an all-time intraday high of $915.90 before pulling back to settle at $903.40. Spot prices have rallied from around $840 at the beginning of the year.
The exchange-traded funds that hold gold bars were gaining, too.
iShares Comex Gold Trust
streetTracks Gold Shares
were each rising 0.3%.
"The thing which has helped gold for a large part of this month to date is some reweighting in some metals indexes, but that's behind us now," says Ross Norman of
As the demand eases, Norman says, gold prices could see a pullback in the near future, and he notes a huge speculative interest in the futures market that could easily reverse. Speculative buyers of futures contracts tend to hold positions for short periods of time before selling.
Elsewhere, the Commerce Department published data showing an unexpected decline in retail sales in December as weakness in the housing sector continues to spread into the wider economy.
A slowing U.S. economy tends to mean a weaker greenback, which in turn often buoys the value of dollar-denominated assets such as gold and silver.
In stocks, RBC Capital Markets boosted its price target on shares of
to $17 from $16, while at the same time trimming its target on
to $11 from $12.
The bank reiterated sector perform ratings on both stocks. The shares were down 0.8% and 1.3%, respectively.