Gold adds almost $4 in New York trade

The price of gold was higher Wednesday, but only after early declines on the news that China does not plan on adding to its holdings in gold due to limited supply and volatility in prices.

August gold was up $3.80 to $1,198.90 per troy ounce in New York trade after falling to as low as $1,185 per troy ounce earlier in the session.

A weaker US dollar helped gold’s gains as the precious metal began to look like a good alternative place to put cash for safekeeping, and there has been some resumption of physical buying in Asia, with India leading the way before religious festivals there.

It was reported that central banks have been selling gold to the Bank for International Settlements at a record rate, with the bank buying 349 tonnes of gold since December under a program in which central banks swap their gold for loans with the ability to buy their gold back later.

Meanwhile, September silver added 80 cents to $18 per troy ounce.

Among base metals, September copper was up 4 cents to $3.02 per pound in New York trade, while three-month contracts were up $82.75 to $6,687.75 per tonne on the London Metal Exchange.

The gains for copper came as equities markets advanced in Europe and the United States, the US dollar weakened, and stockpiles declined.

Copper inventories in LME-monitored warehouses stood at 439,350 tonnes, down 13 percent so far this year.

Other base metals followed copper higher.