Gold Prices Scramble to Recover as Oil Slumps to 7-Year Low; Buyers on Sidelines

Kitco News -- Gold prices have moved up from lower levels to trade near unchanged Tuesday afternoon. Weighing on the yellow metal is Nymex crude oil prices that have hit a near seven-year low and fell below $37.00 a barrel Tuesday, said Frank Holmes, CEO of the San Antonio based firm, U.S. Global Investors. The drop in oil prices is keeping precious metals buyers on the sidelines, he explained in an interview with Kitco News. Gold also continues to see its daily price heavily influenced by the U.S. dollar index. Holmes said he is also concerned by the weak economic news coming out of China – the country’s exports were down 3.7%, year-on-year, while imports fell 5.6% in the same period. Holmes is also weary of the sentiment in the current mining sector after Anglo American PLC (AAL.L) announced it was cutting 85,000 jobs. The company said it was restructuring its business in response to a prolonged commodity-price slump; the news sent mining stocks into a tailspin. February gold was last down $0.80 an ounce at $1,074.40.