Gold did manage to make it as high as $1,529.90 around 4 AM, after recovering from a slump of as low as $1,522.20 just prior to that peak, but overall it stayed close to $1,525. As of 8:18, the spot price was $1,526.90 for a gain of $7.50 on the day. The Kitco Gold Index attributed -$2.70 to predominant selling and +$10.20 to a weakening of the greenback.
The U.S. Dollar Index, as noted above, plunged from the high 75.5s all the way down to 74.95. The tumble ended just before midnight, after which it snapped back to 75.05-75.15. After gaining enough strength to climb up to 75.35, it reversed and reintroduced itself to a sub-75 level. As of 8:25, it was still sinking at 74.97.
A Reuters report ascribed gold's recovery to safe-haven buying and a weaker greenback.
"The dollar is weaker, boosting commodities," said Peter Fertig, a consultant at Quantitative Commodity Research. "Also don't forget the situation in the euro zone, especially the latest comments from an EU official."Holdings of the SPDR Gold Shares Trust stayed steady again at 1,214.08 tonnes.
In the latest development on the Greek crisis, the head of euro zone finance ministers Jean-Claude Juncker said the International Monetary Fund could withhold the next slice of aid to Greece due next month.
"The chances of debt default by Greece are rising," a trader said, adding higher oil prices were also helping gold.
8:30 saw the release of the consumer-spending report for April. Spending was up, but only by 0.4%: the same as income. Spending was hobbled by price rises, like at the gas pump, which are excluded from the core-inflation figures. Gold has already got a head of steam up, rising to the high 1520s on the sinking greenback, but the release of that report gave it a final boost that pushed it above $1,530. As of 8:42, the spot price was $1,530.30 for a gain of $10.90 on the day. The Kitco Gold Index assigned -$1.25's worth of change to predominant selling and +$12.15's worth to greenback weakening. The U.S. Dollar Index halted its decline on the news, but didn't rise. As of 8:46, it was stuck at 74.99.
Thanks to renewed pressure on the U.S. dollar, gold managed to reverse its declines from yesterday and come close to making a new three-week high. Safe-haven demand ebbing from the greenback, and consequent selling pressure, has actually helped the metal instead of hurting. Today's regular session may see some volatility, as a strong start tends to be a bad predictor of the rest of the session. Even if so, gold will still have held up fairly well.