Gold gains on weak dollar, news

Gold prices were higher Monday as the US dollar weakened and even though investment demand was down.

Another factor in gold’s gains was the news that CIT Group (NYSE: CIT), which lends to small and medium-sized businesses, filed for Chapter 11 bankruptcy protection in New York over the weekend, an indication that the troubles in the banking sector are not over yet.

December gold added $13.60 to $1,054 per troy ounce in New York after trading in a range that went as low as $1,042.20 and as high as $1,063.40 during the session.

Contracts for December silver were up 19 cents to $16.44 per troy ounce while January palladium added $11.80 to $1,338.10 per troy ounce and December palladium gained $3.10 to $326.35 per troy ounce.

Meanwhile, among base metals, December copper was down a cent to $2.95 per pound in New York trade but three-month contracts for copper on the London Metal Exchange added $70 to $6,550 per tonne on reports of expanded manufacturing activity in both the United States and China.

The gains for copper came even though LME-monitored stockpiles continue to rise.

Aluminium and zinc prices were also up, and while tin went untraded its bids were up slightly, but lead and nickel prices fell on the session.