Gold gains on ISM US factory data, weaker dollar

Gold and other metals prices were higher Monday as the US dollar weakened on new data showing that manufacturing was up in the United States, the UK and China, sending investors looking for riskier alternative investments and fueling sentiment that demand will increase.

In the United States, the Institute for Supply Management reported that its factory index was up to 48.9 in July, up from 44.8 in June and more of a gain than expected, upping optimism even though at under 50, the index shows that US manufacturing remains in contraction, where it has been for the past year and a half.

December gold was up $3.70 to $959.50 per troy ounce around the close of floor trade in New York, while September silver added 31 cents to $14.25 per troy ounce and October platinum was $25.50 higher to $1,239.70 per troy ounce.

In morning trade, meanwhile, September palladium had added $8.90 to $273.50 per troy ounce in New York trade.

The manufacturing data helped copper, which is used extensively in manufacturing and construction, with hopes fueled that demand will increase as manufacturing recovers.

September copper added 12 cents to $2.74 per pound in New York, while three-month copper gained $276 to $5,995 per tonne on the London Metal Exchange after going as high as $6,011 per tonne earlier in London trade.

Tin, lead, aluminium, zinc, and nickel also all saw gains on the session.