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GOLD PRICE NEWS – The gold price stabilized near $1,617 per ounce Tuesday morning despite strength in the U.S. dollar and a better than expected U.S. economic report. Gold prices held in a tight range in overnight trading – between $1,613 and $1,624 – as the yellow metal continued to consolidate following last week’s rebound. The price of gold subsequently showed a muted reaction to the ISM Services report for May, which at 53.7 came in modestly above the 53.4 consensus estimate among economists.

Silver outperformed the gold price this morning as the industrial component of the white metal helped push it higher alongside cyclical commodities. Silver prices rose $0.14, or 0.5%, to $28.45 per ounce after initially falling to as low as $28.08 in overnight trading.

Gold shares opened fractionally higher in contrast to the gold price, but quickly relinquished their gains. The Market Vectors Gold Miners ETF (GDX) – which yesterday bounced back from a 1.5% intra-day loss to close up by 1.6% – traded down by $0.11 at $47.22 per share this morning after the ISM data. Among the widely-traded gold producers, two of the more substantial decliners today were Gold Fields (GFI) and Randgold Resources (GOLD). GFI retreated by 1.6% to $13.82 and GOLD by 0.8% to $87.44 per share.

With its renewed strength, the gold price appears to have “regained its safe haven status,” according to analysts at Commerzbank. In a report to clients, the firm wrote that “Gold has now successfully bounced off the major 1,532.20/1,522.48 support zone. A minor retracement back to the 1,600 level is now on the cards but the next lower significant 1,532.20/1,522.48 support area should not be retested any time soon, though.”

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Commerzbank went on to say that “We expect the precious metal to stay above its late May high at 1,584.20 on a daily closing basis in the course of this week and for it to head higher still in the near future.”

The gold price also received a tailwind from data out of China, which showed that imports of the yellow metal continued to rise. HSBC contended that “Gold prices may be supported by China’s growing appetite for bullion, as imports from Hong Kong climbed to record highs. Furthermore, imports of gold coins, which are reported in a separate category in the trade data, increased significantly to 1,876 kg in April from 5 kg in March.”

“The ability of China to sustain gold imports is impressive,” HSBC added, “considering that the economy is showing signs that growth is cooling and income growth is moderating.”

As for the broader equity markets, they opened slightly lower but soon after reversed to the upside. Following the ISM report, the Dow Jones Industrial Average (DJIA) advanced by as much as 0.3% to 12,136.35 and the S&P 500 by 0.5% to 1,285.10. Investor risk aversion declined concurrently, as the CBOE Volatility Index (VIX) slid 5.2% to 24.73.