Gold rebounded from six-month, heading for the 11th annual gain while recording a weekly and monthly drop. The shiny metal witnessed another year of rise as the safe have characteristic helped the metal to advance amid the escalating European debt crisis and sluggish global growth. However, the yellow metal lost its merit as being a refuge at the end of the year, leaving this place for the dollar and yen. Thus, it recorded sharp losses in September while pared some of the drop in October and November before dropping again in December, raising speculations the shiny metal may continued its downside direction in 2012. The only data released today showed Chinese manufacturing recorded a contraction of 48.7 in December compared with the prior reading of 49.0, where a reading above 50 indicates expansion. Investors' thinking remained on the yield on the Italian 10-year notes which retreated to 6.98% compared with 7.56% in the previous auction as the rate is considered high as it is still near 7%, a rate which triggered bailouts for Greece and Portugal. Also, the ECB said this week the balance sheet soared to 2.73 trillion euros, where lending to banks climbed to 879 billion euros in the week ended Dec. 23 on the back of last week's 489 billion euros three-year loans lent to 523 banks., where the announcement raised concerns the ECB will continue its support to banks to avert a financial disaster. On the other hand, the dollar showed slight advance, where the dollar index, which tracks the greenback's movements versus six major currencies, is currently hovering around 80.40 compared with the day's opening of 80.34. Spot gold is currently traded higher around $1535.20 an ounce, doing an upside correctional movement after dropping over the past four five sessions, after recording a high $1573.87 and a low of $1543.95. The shiny metal managed to remain above a critical support level at 1530.00 as the breach of this level would trigger further decline. Crude oil also fell from six-week high to trade $98.96 a barrel compared with the day's opening of $99.76.
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