From WSJ online:

August gold futures are expected to open floor trading in New York around $7 an ounce higher Friday, based on electronic activity ahead of the pit session at the Comex division of the New York Mercantile Exchange. September silver is expected to be up 25 cents an ounce.

A weaker U.S. dollar and chart-based strength enabled spot gold to advance during overnight trading, London-based analysts said. At 7:51 a.m. EDT, spot gold was trading up $6.85 to $946.

In other markets that have the potential to impact metals in the short term, the euro is up to $1.4084 from $1.3988 late Thursday afternoon. In screen trading ahead of the pit open, the September S&P 500 futures are down 1.10 points to 915.50. August crude oil is nearly flat, down 6 cents to $70.17 a barrel in overnight activity.

U.S. economic data start with May personal income and spending due out at 8:30 a.m. EDT (1230 GMT), forecast to be up 0.2% and 0.3%, respectively. The University of Michigan consumer-sentiment index is scheduled for release at 9:55 a.m. EDT (1355 GMT) and is forecast to hold at the 69 reading from the middle of the month.

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The WSJ reports that gold “fell $21.30 to $940.70 an ounce on the Comex division of the New York Mercantile Exchange.”

Why you ask? Because the ever mercurial dollar is up again, which means that the inversely proportional gold will come down. But as we’ve seen time and time again this year, gold and the dollar don’t stay in one place for long.

From the Associated Press:

“Gold and other commodities recouped some of their losses on Tuesday as the dollar slipped against other currencies.

. . .Commodities have largely been at the mercy of the dollar in recent weeks, and tend to rise when the dollar falls and vice versa. .

Gold for August delivery rose $2.20 to settle at $954.70 an ounce on the New York Mercantile Exchange.”

The dollar has been falling pretty steadily against the GBP and the Euro for the last three months.  Financial experts believe this is because the Fed has kept interest rates so low for so long that investors are trying to seek larger returns overseas, thus boosting foreign currency and dropping the buying power of the dollar.

From Reuters.com:
“Gold futures dropped more than 2 percent in heavy trading on Friday as the dollar rebounded sharply after a report showed that U.S. job losses in May were far less than expected, dampening bullion’s appeal as a safe-haven investment.”

Even though unemployment numbers have slowed their decline, most experts don’t expect a rise in job numbers until summer of 2010. This could mean that the demand for safe-haven investing will go up again, swinging gold and other precious metals back up to the top of the arc.

If you run a gold company that makes 30 times the average (so far) of other stocks, how do you go about growing? Even though their returns are quite a but higher than the national average, these companies still want to grow, so they’re looking into other metals to diversify their earnings. “If your base business is so challenging, why wouldn’t you look at something that has a better model?” asked one banker who follows the industry. (Courtesy of Reuters)

They might look to copper, or silver: metals that have previously been considered “lesser” are being looked at as a great way to diversify portfolios for large companies. “It could also be a good time for gold companies to consider acquisitions in other metals, as the price of gold has rebounded during the recession, while prices for base metals have dropped sharply, making relative values attractive.” (Reuters)

From MarketWatch.com:

“Gold futures on Wednesday finished higher for a second consecutive day as the latest economic data fueled thinking of inflation ahead, bolstering the dollar-denominated precious metal’s appeal as a hedge. Gold for June delivery climbed $6.70, or 0.7%, to end at $911.00 an ounce on the New York Stock Exchange. Copper for July delivery gained 10 cents, or 5%, to $2.187 a pound.”

As the economy continues to flounder, more and more people seem to be asking themselves if their money is in the safest place. While the price of gold does fluctuate, it has never, in the history of civilisation, been considered worthless, which means that it’s got a phenomenal track record. Possibly the kind of thing you want in your portfolio?

It’s always a little surprising to realize that there are so many strange news articles about or involving gold (normally a unique type of theft) and today is no exception:

Today, Fox News is running a story about a woman that smuggled 500 lbs of gold out of her employers vault over nearly a six-year period. That’s not what’s odd: it’s that fact that she created a false bottom to her handbag and smuggled the bars out individually. After an investigation was launched, the woman showed up at her work, admitted she had taken the gold, and handed back a suitcase filled with close to $900,000 of bullion, which was about 66 lbs of gold.

Police later searched her house and found an additional 447 lbs of the shiny precious metal.

Read the full tale here.

Who knew Swine flu would affect the stock market? Unbelievable maybe, but true according to the Wall Street Journal. They have cited the increasing panic about the newly christened pandemic as one of the reasons that gold closed today a little under $900/ounce.

The other, less medical reason they have cited is that the India, the world largest gold importer, has an increasingly weakening currency which drives down the cost and level of their imports.

Gold rose to a three week high today after news that China is increasing it’s gold reserves. The world’s most populous nation added 454 tons to its national reserves, which makes it number 5 on the list of the world’s largest gold holders. The law of supply and demand would ensure that China’s hoarding will drive up the price of gold as long as it is in high demand.

Gold closed today at $910.80.

Watching the price of gold over the last year has been like a roller coaster, but more recently it’s one with very little hills and valleys instead of huge drops. Stocks plummeted today as investors are pulling their money out of more and more things and putting the funds into gold.

According to the AP- “The decline in stocks comes after six weeks of massive gains that have carried the Dow Jones industrial average up nearly 25 percent from a 12-year low. That rally, sparked by optimism that the financial system’s health was improving, curbed demand for safe-haven assets like gold and boosted prices for other commodities like oil.”

Gold closed at $887.50.