Dubai Gold Trade Up 73% in First Quarter

Dubai Multi Commodities Centre said that gold trade through Dubai reached $7 billion in the first quarter of 2008, up by 73 percent during the same period in 2007.

Dubai’s gold trade has witnessed consistent growth over the last six months, registering a 42 percent increase over the fourth quarter of 2007, when it reached $4.96 billion, DMCC said. Gold price averaged $925 per ounce during the first quarter of 2008.

According to figures compiled by the Statistics Department of Dubai World, a total of 115 tons of gold was exported from Dubai in the first quarter of 2008, an increase of 74 percent from the corresponding period in 2007, and 49 percent higher than exports during the last quarter of 2007. Gold exports from Dubai recorded 66 tons in the first quarter of 2007, rising to 77 tons in the fourth quarter of 2007.

In addition, 122 tons of gold was imported into Dubai during the first quarter of 2008, with imports mostly comprising scrap and jewelry. With a quarter-on-quarter comparison, this figure is an increase of 14 percent from 107 tonnes in the fourth quarter of 2007, although imports have recorded an eight percent decrease from 132 tons for the first quarter in 2007.

“With global gold prices crossing the $1000 mark and remaining significantly high throughout 2007, there has been an impact on the volume of imports into Dubai,” said Ian McDonald, executive director - Gold and Precious Metals, DMCC. “However, in keeping with global trends, gold refining has also been on the rise. With scrap becoming an important component of imports, the Emirate’s growing significance as a gold refining centre has been further emphasized. In addition, increasing export volumes of gold bullion have given a boost to Dubai’s role as a leading physical hub for the regional gold trade.”
Source: jckonline

'May is Gold Month' returns

May is Gold Month" ads like this one created for Ben Bridge Jeweler are scheduled to run throughout May.

Though the rising price of gold has made retailers skittish about sales, "May is Gold Month," a national retail promotion aimed at increasing consumer sales of gold jewelry throughout the month, will be targeting spring shoppers.

Duvall O'Steen, director of jewelry public relations and promotion at the World Gold Council (WGC), says May remains a great time to buy gold for special occasions such as Mother's Day and graduations, or for self-purchase.

Part of the buzz this May will be generated by the official participating retailers who have collectively spent some $3 million so far to launch their new, fashion-forward gold assortments in a national media campaign in magazines such as Elle, Good Housekeeping, Harper's Bazaar, InStyle, People and Redbook.

The campaign will also be supported at retail with point-of-sale signage, window displays and direct-mail catalogs. More broadcast retailers are jumping on board this year too, O'Steen says, which will heighten consumer awareness.

The campaign isn't just growing by way of media attention, but also in terms of dollars spent. In 2006, the campaign partners spent $3.2 million, and last year that figure rose to $3.6 million. It's hoped that this May's total sales, to be tallied this summer, will be even higher.

Although the WGC can't release sales growth figures because of confidentiality reasons, O'Steen says that partner stores witness double-digit sales growth in May, on average, as a result of the promotions. She acknowledges this year could be different due to the faltering economy, but remains hopeful.

John Calnon, WGC's U.S. managing director, says prior to 2007, gold sales had been increasing rather nicely, and 2007 saw increases until the fourth quarter, which saw a downturn.

With the troubled economy and increasing price of gold, O'Steen advises retailers to focus on the precious metal's value, and adds that the consumer perception of gold's intrinsic and lasting value has actually been strengthened by the higher prices.

"When things are expensive, we want them," O'Steen says. "We aspire to them."

Value doesn't mean cheap, O'Steen emphasizes, and customers still want to buy the best they can afford. Consequently, she says, selling inexpensive pieces isn't necessarily the way to go.

"Consumers want to make sure it lasts and is durable," she says.

O'Steen adds that in addition to consumers seeking luxury items, regardless of price, gold's own attributes can also help keep sales up.

One such quality to emphasize is its lasting nature. Unlike a pair of shoes or a purse that wears out quickly, 15 years after purchase, gold will still be around. She adds that value on the design side also helps for greater sales, as do pieces that offer versatility.

The co-sponsors of the program, the WGC, Jewelry.com and the Richline Group, will collaborate with retailers including Belks, Ben Bridge Jeweler, BJ's, J.C. Penney, Jewelry Television, Macy's, ShopNBC, Sterling Jewelers and QVC to launch the campaign, which will feature new gold collections.

Independent retailers are, once again, invited to participate in the campaign by downloading the May is Gold Month logo and point-of-sale materials from the WGC's Web site, Marketing.Gold.org.

O'Steen says the WGC always intended to make the campaign industry-wide but wanted to ensure it was strong before welcoming it to all.

"Independents should capitalize on the buzz," she says.

May is Gold Month will also raise funds and awareness for Jewelers for Children, an organization benefiting children who have been affected by illness, abuse or neglect, through a sweepstakes to be hosted on Jewelry.com.

The sweepstakes offers consumers the chance to vote on and win their favorite new gold jewelry design, with the Web site making a contribution of 10 cents—up to $50,000—for each completed sweepstakes entry.

The online sweepstakes will be supported with digital marketing.
Source: nationaljewelernetwork

Gold prices dominate spring buying plans

Many retailers at the JA New York Winter Show did not buy more merchandise than last year due to high metal prices.

Retailers strolling the aisles at the JA New York Winter Show presented a mixed picture of expectations for 2008, a year overshadowed by the threat of recession and increasing gold prices.

Some were optimistic in the face of the economic downturn, while others were bracing for a rocky year—divergent viewpoints seemingly fueled by geographic location.

One common thread among retailers interviewed by National Jeweler at the March 9-11 event was that they were not buying more merchandise than they did last year, with many feeling the pinch of rising metal prices.

One buyer, Bobby Vellios of Bobby's Jewelry Ltd. in Brooklyn, N.Y., said that with holiday sales down at his store, he had to downsize his expectations for 2008, and planned to buy less than he did in 2007. Still, he was optimistic, viewing the business as a roller coaster ride that will swerve up again.

Angela Defelippi from the Farmington, Conn.-based Monarch Jewelers was also stocking less merchandise this year, with the expectation that business will not improve for at least another two years. On her to-buy list at JA were traditional items, such as diamond jewelry and bridal sets.

"Everyone will always be getting married, no matter what the economy [does]," she said.

On Defelippi's not-to-buy list: gold, because the prices were, in her words, "astronomical."

"Everything is down with everyone across the country," she said, noting this is especially true in the Northeast, where high oil and gas prices are forcing consumers to be more frugal.

A cold front in Northeast retail? Vellios and Defelippi were not the only Northeast jewelers feeling the sting of a consumer spending drop.

National Jeweler's Year-End Sales Survey, 2007 depicted a slow year nationwide, but the Northeast was hit particularly hard, with the highest percentage of retailers surveyed—60.5 percent—reporting sales were down or flat for the year.

Rick Billig of Billig Jewelers in Marlton, N.J., was buying limited amounts of merchandise and said he was hoping for an average year. Yellow gold jewelry has been selling despite the price, but the pieces moving off the shelves have been lighter fashion pieces, he said.

Like Defelippi, Wendy Billig was skittish about new products, and said she was sticking with "proven sellers" and lighter gold pieces.

"It's all about that gold price," she said.

Similarly, Carol Mitnick of The Cosmopolitan Collection in Haddonfield, N.J., was searching JA for less expensive, lighter-weight gold pieces and sterling silver.

Despite economic woes, Mitnick said her holiday sales were good, thanks to colored gemstone sales, specifically.

At William S. Rich and Son in Union, N.J., Sherry Sablosky was poised for a down year and planned to buy less.

"With the price of gold, retailers are definitely down," Sablosky said. "We're trying to sell [gold], but you can't even buy a chain to sell. People don't want to pay those prices."

Retailers from other areas of the country attending the show at the Jacob K. Javits Convention Center in New York had a more optimistic outlook for 2008.

C. Niki Hunn of Thomas Hunn Jewelers in Grand Junction, Colo., said that thanks in part to the store's "recession-proof" location, holiday sales were strong and she anticipated a good year.

Designer Sonya Ooten of the Sonya Ooten Gem Bar in Los Angeles was also upbeat.

"I'm feeling like we've made it through the worst of it," she said, adding that in the L.A. area, the writers' strike, now over, had slowed sales.

Still, Ooten hopes gold prices level out this year, noting they were as low as $212 an ounce just a few years ago.

"It's crazy," Ooten said. "I'm hoping we've reached the max and they'll be going down."

While her margins have shrunk, Ooten refuses to raise prices and risk losing customers, but she is also creating more pieces using all gemstones and no gold.

The power of positive thinking Cheryl Schneider from Romance Jewelers in Concord, N.H., has adapted a new strategy that has had sales rising every month since November. She is teaching her salespeople to approach customers with the attitude that if they are inside the store, they want to buy something. Plus, she has lowered prices on older merchandise that hasn't moved in a long time.

"I think it's a mindset," Schneider said. "Just because the economy's bad doesn't mean it has to be doom and gloom in your store."

Though she will not buy more merchandise in 2008, Schneider is changing her buying strategy, investing in colored stones and diamonds, plus "bigger looks for your money," while staying away from gold because of the price.

Gina Stout, a buyer for New York-based Platinum Plus Jewelry, also planned to buy the same amount of stock in 2008 as she did in 2007.

"I'm looking for specific pieces customers have asked for," she said.

Lourdes Zeik-Chivi of Leonardo Jewelers in Red Bank, N.J., had the same concerns as her Northeastern counterparts but said the luxury consumer will still buy.

"The haves will be buying and the have-nots will be falling by the wayside," Zeik-Chivi said of the upcoming year.

She said she planned to spend the same dollar amount on inventory at JA, but was expecting to get less product for her money.

She has a strategy, however, for a challenging year, and said retailers who want to survive should understand their customer base and offer interesting products. On her shopping list were gold and diamond pieces, although higher gold prices would limit the quantity of goods she could buy.

Zeik-Chivi, who has been focusing on yellow gold for two years, said yellow gold with colored gemstones continues to be a popular seller.

"Only the haves are buying gold," she said, referencing consumers. "It creates an aura that 'If I like it and can buy it, I will buy it.'"
Source: nationaljewelernetwork

Gold prices have people cleaning out jewelry cases

A necklace with a broken clasp. Gold earrings missing their match. An old dental bridge needing a patch.

Frances McLemore of Olive Branch put them all in a batch and to the jewelry store she went, to sell them for cash.

McLemore is one of many people around the country cashing in on the rise in gold prices, to a height that hasn't been seen in 28 years.

As McLemore was getting her gold jewelry appraised, gold was sitting at $922 an ounce, down from more than $1,000, but considerably higher than the typical $500 or $600 an ounce price.

Terry W. McMullin is an Olive Branch resident who has been in the jewelry business 34 years. He and his wife, Jackie, put a banner outside Master Jewelers: "We Buy Gold."

He said people started bringing in bags of gold jewelry when the price hit $900 an ounce. Even more prospectors came after it reached $1,000.

One woman brought in "a whole collection of jewelry," McMullin said, worth $50,000 if purchased new. She planned to give the money to her two grown children, both behind on their mortgages.

Some people are having trouble assessing if their jewelry is worth trying to sell.

"A lot of people, believe it or not, don't believe it's worth anything. It's broken," McMullin said. "We're telling people, if you're not sure it's gold, bring it in, we'll test it."

Scratching the jewelry against a stone and testing the mark with sulfuric acid reveals to a trained eye like McMullin whether the piece is gold.

Twenty-four carat is pure gold and pays more. Ten carat is only 41.7 percent gold. The rest is an alloy.

McMullin pays for the gold in the piece, but a piece may be worth more for its antiquity, as in the case of gold coins, which people also have been selling to him.

As for the future of gold prices in the volatile market, McMullin said, "I tell everybody that my crystal ball is no clearer than theirs."

He is not keeping all that gold around very long, however. He is selling while the price is as high as it is.
Source: djournal

Jewelry trends adapting to record gold prices

Diamonds might be a girl's best friend, but for those buying jewelry at a time of record gold prices, a new trend for lightweight pieces using semi-precious stones and organic materials might be a welcome ally.

Jewelry trends in recent years have been dominated by chunky pieces worn around the neck and clunky gold bangles around the arms and ankles.

But while these heavy-weight pieces may still be favored by the rich and famous, jewelry-lovers with more limited means are being targeted by a new trend for slinky jewelry, hollowed out pieces and jewelry made from non-traditional materials.

Sophisticated simplicity is the buzzword used by European fashionistas, while the trend in Asia is for street-chic and rustic pieces made of semi-precious stones and non-traditional materials including titanium and wood.

"It's no longer about the bling, about the gold. The days of the big heavy gold chain are probably over, and if they are still around, they will be a lot lighter," Desmond Lim, fashion editor at Prestige and August Man, two Singapore lifestyle magazines.

"It's about smart fashion and this casual-chic style is probably a reflection of both fashion and economics. There is a definite balance between the art and the commerce, resulting in this street chic look."

The prices of gold and platinum have both rocketed to record highs, with spot gold trading just short of $1,000 an ounce and platinum above $2,000, prompting some jewelry makers to opt for light weight and hollow pieces.

"In fashion jewelry, the designers are offering us lighter weight designs. Interestingly, this means more inventive and innovative design and the craftsmanship is still there," said David Hinds, managing director of F. Hinds, a family-owned jewelry chain in the United Kingdom.

Retailers in London's Hatton Garden jewelry district are seeing a similar trend and a shift in favor of hollow jewelry which consumes less precious metals and are being sold for more or less the same prices that heavier items sold for a year or two ago before gold prices really began to soar.

"A lot of chains are being made hollow and the reduction in weight is compensating for the rise in gold prices," said Roy Lynch, director of Strictly Gold.

He added that his company had launched a new range of lighter weight products to complement their traditional heavier lines.

JeweJewelerslrs the world over have complained that they need to review prices of their pieces on a daily basis due to the swings in gold prices in recent weeks. Customers are being told prices are only valid for the duration of that day.

OPULENT JEWELLERY

The trend for light-weight jewelry has not extended to high-end diamond rings, where most of the value is from the stone. Buyers are still prepared to hand over the cash for items such as engagement rings.

"People aren't going to skimp on things like that," said Lisa Argenton, an Australian jewelry designer.

"People are still happy to spend money on jewelry with meaning, although some clients who really want platinum find they can't afford it and go for white gold instead. Generally, platinum pieces are two to three times dearer than 18 carat white gold."

Record gold and platinum prices are never likely to deter high net-worth individuals from indulging themselves.

"One of the biggest things in fashion right now are gold cuffs -- big, chunky yellow gold bracelets," Carol Woolton, jewelry editor at Vogue magazine in the United Kingdom.

But she added some designers were also opting to make cuffs in wood, set with semi-precious stones. Although she admitted that none of the trends for less opulent jewelry were on display at the Academy Awards in February.

"Interestingly, there was more jewelry on the red carpet at the Oscars this year than ever before. A lot of actresses are wearing big gold necklaces," she said.

"Nicole Kidman wore a sautoir necklace in white metal -- gold or platinum -- studded with 7,000 diamonds totaling 1,400 carats."

The jewelry display at the Oscars underscored the view from high-end jewelers that the rich are not deterred by gold prices.

Stanislas de Quercize, president of Paris-based fine jewelry house Van Cleef & Arpels, told Reuters recently that all-time high precious metals prices would not alter the raw material content of Van Cleef & Arpels jewelry as his clients wanted only the best.

"We have high-demanding clients who want the best art (in jewelry)," De Quercize said.

"We have to fulfill the mission to offer the best. The appetite for rare stones is growing and growing."
Source: yahoo

Gold bangles display in a jewelry shop

Gold bangles can be seen on display in a jewelry shop in South London, Tuesday, Jan. 15, 2008. Shares of gold producers rose in Monday afternoon trading as the price of the precious metal set an all-time high for the third day in a row. An ounce of gold for February delivery on the New York Mercantile Exchange touched $915.90, its highest ever, before settling at $903.40, up $5.70 for the day.(AP Photo/Sang Tan)

Activists see gold in jewelry retailers

Activist investors Nelson Peltz and Richard Breeden continue to mine greater stakes in jewelry retailers despite weak consumer spending and soaring gold prices.

Peltz’s fund on Wednesday hiked its stake in Tiffany & Co. to 7.9 percent, while Breeden on Tuesday raised his stake in Zale Corp. to 17.66 percent. Peltz has spent 11 months trying to goad Tiffany to improve its margins and address operational and strategic issues.

Breeden, meanwhile, signaled in September that he believed Zale’s shares were undervalued and that he may try to initiate a major transaction at the company. Last year, Zale sold its higher-end jewelry chain Bailey Banks & Biddle and has been working to streamline its business to increase shopping-mall based sales.

Despite a slowdown in consumer spending, Tiffany executives said on Tuesday the company had no plans to slow its store-expansion rate. Tiffany, whose products range from under $100 to over $50,000 a piece, said it would be just fine even if the United States slid into a recession.

Tiffany’s confidence comes as Goldman Sachs on Wednesday raised its 2008 gold price forecast, factoring in an expected U.S. recession in the second and third quarters of the year that could lead to a weaker U.S. dollar. Goldman predicted that gold would reach $915 per ounce in 2008. Gold topped $900 an ounce for the first time ever last week.

Plus, last week, Tiffany cut its outlook for the year ending on January 31. Yet, Peltz and Breeden obviously see potential in these jewelers.

Shares of Tiffany jumped $1.60, or 4.5 percent, to $37.26 on Wednesday amid news that Peltz’s fund raised its stake. Peltz declined to comment. Shares of Tiffany have fallen about 5.5 percent over the past year.

Shares of Zale jumped $1.65, or 12.9 percent, on Wednesday. Zale’s stock, however, has plunged 48 percent over the past year.

Tiffany and Zale could not be immediately reached for comment.
Source: reuters

Gold shines for Italy's high-end jewellery trade

Italy's once-dominant jewellery industry will likely grow more polarised this year as prices of precious metals and stones soar, hitting mass market jewellers while high-end jewellers are confident of doing well.

Still the world's leader in design, Italian jewellery has been hit hard by surging gold prices and lost its top production ranking in fierce competition with India, China and Turkey which have lower labour costs and have improved quality.

"There is an ongoing polarisation of the market," Daniela Invernizzi, Italian representative of the industry-funded World Gold Council, told Reuters on Sunday at an international jewellery fair in Vicenza.

"The high-end is not suffering (from the high gold prices). Those who suffer most are in the "i-pod" segment of jewellery which costs between 200 euros and 1,000 euros," Invernizzi said.

Italian high-end jewellers attending the fair said they were cautiously optimistic about this year after betting on exclusive bespoke items which helped them counter the backlash of soaring gold prices and boost sales in 2007.

"2007 was a very good year because of our strategy of focusing on the very high segment of the market," said Filippo Picchiotti, chairman of the family-run Picchiotti, makers of bespoke diamond jewellery with price tags of up to $1.5 million.

Picchiotti said he hoped his company would repeat this year a 10-15 percent rise in sales it had last year. Picchiotti, as did many other high-end jewellers, managed to pass on rising costs to consumers who effortlessly splash out on big ticket items.

But the spending appetite of middle class consumers has been moderate recently with choices shown often in favour of a new mobile phone or a holiday trip rather than jewellery, hitting particularly hard mass market goldsmiths.

"I think this segment will die out eventually," said Paladino Orlandini, designer of exclusive gold jeweller Atelier Orlando Orlandini.

WGC's Invernizzi disagreed, saying Italian manufacturers of machine-made gold chains can still stay ahead of competition thanks to new technologies allowing them to make lighter weight pieces with sophisticated designs.

 

DIFFICULT U.S MARKET

Mass market consumer sentiment on the key U.S. market soured in the second half of 2007 as the mortgage market crisis and strong euro, versus the dollar, restrained buying power, jewellers at the Vicenza fair said.

Italian jewellery sales in the United States fell 7.5 percent to 486 million euros ($718.1 million) in the first nine months of 2007, accounting for a 14.6 percent share of total Italian jewellery exports in the period -- a far cry from 25 percent a few years ago.

But top end jewellers said their clients have not been put off by credit market woes or strong gold prices.

"We sold less items there, but of a higher price," said Picchiotti, adding his group's sales in the U.S. market were stable last year.

Designer Roberto Coin, who sells in Northern America a lion's share of his exclusive diamond-rich jewellery, said sales to one U.S department store jumped 50 percent last year, with items priced at $20,000-40,000 selling especially well.
Source: guardian

Gold, platinum prices continue surge

Platinum hit a record high of $1,409 per ounce in London today, as gold prices hovered near a 28-year peak, Reuters reported.

Platinum prices soared in part due to issues over supply. Anglo Platinum, the world's biggest platinum producer, was affected by power outages in South Africa, the firm told the news source. Dealers, however, said it might be difficult to sustain the high price, expecting it to pull back to around $1,375 per ounce.

Platinum also got a boost from a surge in gold prices on Thursday due in part to the weakening U.S. dollar and firm oil prices.

Gold's spot price in London stood at $747.10-$747.90 per troy ounce compared with $750.40-$751.20 in New York on Thursday, when it rose as high as $753.60, its highest since January 1980, according to Reuters.

Investment bank Morgan Stanley stated its 2008 gold-price forecast at $800 per ounce, anticipating that strong global growth and spreading inflation problems would benefit the metal.

The bank told Reuters that growth in gold demand, particularly from an expanding middle class in the developing world, would continue to drive gold prices, despite inflation and dollar concerns temporarily taking the spotlight.

Meanwhile, Morgan Stanley said it was leaving its previous forecast for 2007 gold prices intact at $680 per ounce, but lowered its silver price to $13.30 per ounce from $13.80 per ounce, and placed the 2008 forecast at $15 per ounce.

"Silver prices have been weighed down by economic uncertainty...specifically, silver's exposure to industrial demand has made prices vulnerable to general economic growth concerns stemming largely from fears concerning a U.S. growth slowdown," the bank said.
Source: nationaljewelernetwork

Gold to Rise Above $1,000 on Jewelry

Gold will surge to more than $1,000 an ounce driven by increased jewelry demand and a weaker dollar, Newmont Mining Corp. Vice Chairman Pierre Lassonde said.

``Gold's time is coming,'' Lassonde said at the Diggers & Dealers conference in Kalgoorlie, Western Australia today. The price will have three zeros, ``I just don't know what the first number is going to be,'' he said, without giving a timeframe.

The supply of gold from mines is dropping as companies fail to make major discoveries and licensing issues slow down construction, Lassonde, 60, said. Gold jewelry demand is expected to rise from last year's value of $45 billion, he said. Gold at $1,000 would be 49 percent higher than today's price.

``The outlook for gold is bullish, but there's perhaps some vested interest in those forecasts,'' said Michael Widmer, the head of metals research at Calyon, the investment banking unit of Credit Agricole SA.

Gold for immediate delivery rose as much as $1.30, or 0.2 percent, to $674.30 an ounce today, and traded at $672.68 at 6:31 p.m. Sydney time. Gold futures reached a nominal record of $873 an ounce in January 1980, while the spot price reached a 26-year high of $730.40 in May, 2006.

`Bull Market'

``This bull market in natural resources will last a whole generation, that's 20 years,'' Lassonde said in remarks to the conference. ``China and India will have hiccups but, no, they will not stop growing.''

Gold and oil will be the best performing commodities in the current cycle, while the prices of copper and molybdenum have peaked, he said. Gold will rise to more than $850 within 12 months, and will rise above $750 by fall, Lassonde said.

Calyon's Widmer said he's forecasting average prices of $650 for the current quarter, and $700 for the final three months of 2007. ``The average for next year, I think, will reach $720,'' he said. ``We can still go higher from where we are.''

The price of gold will be boosted by increased global wealth, which will spur jewelry sales, Lassonde said. Jewelry accounted for two-thirds of gold demand in the first quarter.

Demand in India, the world's largest buyer, rose by half in the first quarter from a year earlier to 211 metric tons, while demand in China gained 31 percent, the London-based World Gold Council said in May. Demand growth may have continued at that rate during the second quarter, the Council said July 3.

``That is what is underpinning the demand for gold, is that the world is getting richer and richer,'' Lassonde said separately in an interview. ``It is not just the China, India story here, it is a world story.''

The precious metal, which often moves in the opposite direction to the dollar, may also gain as the U.S. currency declined, Lassonde said. The euro has risen 7.7 percent against the dollar in the past 12 months.

Lassonde retired in December as president of Denver-based Newmont, the world's second-biggest gold producer. Toronto-based Barrick Gold Corp. is the world's biggest gold producer.
Source: bloomberg

Gold in Asia Increases on Jewelry Demand; Silver Little Changed

July 12 (Bloomberg) -- Gold rose in Asia for the fourth day in five as demand increased from jewelers, the biggest users of the precious metal. Silver was little changed.

Good demand for the metal from India and Turkey emerged earlier this week, Goldman Sachs JBWere analysts, led by Malcolm Southwood, said in a report on July 10. Jewelers accounted for 69 percent of first-quarter gold consumption, from 61 percent a year earlier, the producer-funded World Gold Council said May 16.

``The basic tone for all precious metals at the moment is range-trading, but the downside is limited because of strong physical demand,'' Nobito Kaneda, a trader at Sojitz Corp., said by phone from Tokyo today. ``Gold dipped below $660 yesterday and attracted some buying.''

Gold for immediate delivery gained as much as $1.85, or 0.3 percent, to $662.50 an ounce, and traded at $662.20 at 1:05 p.m. Singapore time. Silver for immediate delivery gained 1 cent, or 0.1 percent, to $12.91 an ounce.

Bullion declined late yesterday in New York as gains in the dollar against the euro eroded the appeal of the precious metal as an alternative investment.

The euro traded at $1.3758 at 11:45 a.m. Singapore time. It closed at $1.3746 yesterday after reaching $1.3787, the highest since it was introduced in 1999.

In Japan, gold for delivery in June 2008 gained 11 yen, or 0.4 percent, to 2,634 yen a gram ($670 an ounce) at 1:13 p.m. Singapore time on the Tokyo Commodity Exchange.

Oil Price

Oil's gains to the highest in almost 11 months may only have ``a passing impact on gold,'' David Moore, an analyst at Commonwealth Bank of Australia. Gold prices have traditionally moved in tandem with oil prices because some investors buy gold to hedge against rising consumer prices.

Central banks were vigilant on inflation and that probably lessened concerns for a sustained rise in consumer prices, Moore said by phone today from Sydney.

The return on other assets was distracting investors from investing in gold, and bullion would decline to $625 an ounce by the end of the year, he said.

Gold for August delivery gained as much as $1.5, or 0.2 percent, to $663.60 an ounce, and traded at $663.40 at 1:23 p.m. Singapore time on the Comex division of the New York Mercantile Exchange.

A futures contract is an obligation to buy or sell a commodity at a set price for delivery by a specific date.