Advertisement

  • News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
BW Businessworld

Gold Firm But Hemmed In Tight Range; Set For Worst Week Two Months

Spot gold rose 0.2% to $1,555.14 per ounce by 0602 GMT, heading for a weekly drop of 0.4% - its biggest since the week ended Nov. 8.

Photo Credit :

1577183810_3e92Fc_gold.jpg

Gold prices edged higher on Friday but traded in a tight range as investors stayed on the sidelines in the absence of news catalysts.

The metal, however, was on track to post its biggest weekly drop in two months, as a long awaited U.S.-China Phase 1 trade deal fuelled risk appetite.

Spot gold rose 0.2% to $1,555.14 per ounce by 0602 GMT, heading for a weekly drop of 0.4% - its biggest since the week ended Nov. 8.

U.S. gold futures rose 0.4% to $1,556.90.

"Looks like we are just out of catalysts in the very near term. (Gold) prices are digesting recent volatility and are basically in a wait-and-see mode," said Ilya Spivak, a senior currency strategist at DailyFx.

Meanwhile, data showed China's economic growth slowed to its weakest in nearly 30 years in 2019 amid the trade war with the United States and sputtering investment.

"This year we will see a bit more capital flows coming into gold, on the backdrop of weakening economy and geopolitical tensions," said Brian Lan, managing director at dealer GoldSilver Central in Singapore.

The 18-month-long trade war between the world's top two economies bruised the global economy and pushed gold prices 18% higher last year. Gold is considered a safe asset in times of political and economic uncertainty.

Financial markets received a slight reprieve after the announcement of the trade pact, although concerns about tariffs and unresolved core issues remained.

Weighing on gold, Asian shares rose after global stock indexes and Wall Street posted more records.

Holdings of the world's largest gold-backed exchange-traded fund SPDR Gold Trust rose 0.13% to 879.49 tonnes on Thursday.

Palladium soared 0.9% to $2,333.50 an ounce, after hitting a record high of $2,395.13 on Thursday, and was set for its biggest weekly gain since January 2017.

"Palladium (prices are soaring) like a rocketship. It doesn't look like there's more of a story here than the auto-catalytic demand story," said DailyFx's Spivak.

However, "it's starting to look like prices are rising because there's an expectation that they would go up. And that's a dangerous place, because this is how bubbles are made."

Platinum jumped 0.9% to $1,013.57, after hitting its highest since February 2017 at $1,041.05 in the previous session.

"Much of it is a catch-up with palladium, it's a spill-over. Platinum is not as efficient (for catalytic converters as palladium), but if palladium is this expensive then that's the option," added DailyFx's Spivak.

Silver advanced 0.5% to $18.02 per ounce.

(Reuters)


Tags assigned to this article:
gold silver commodity prices
sentifi.com

Top themes and market attention on: