Waheed Mahmood
LONDON: Gold climbed on Wednesday as the dollar fell sharply against the euro and yen after a report suggested the US Federal Reserve planned to boost growth by purchasing $500 billion in US Treasury debt over six months.
Spot gold was bid at $1,344.00 an ounce at 1625 GMT, against $1,336.00 late in New York on Tuesday. US gold futures for December delivery rose $8.30 an ounce to $1,344.30.
The precious metal fell 2.5 per cent on Tuesday, its biggest one-day loss since July 1, after China raised its benchmark interest rates by 25 basis points, sparking a dollar recovery.
While fresh weakness in the US currency helped prices to rise back above $1,340 an ounce, its move has been relatively muted after Tuesday’s hefty losses.
“We’re seeing a pretty big move in the dollar to the downside and we’re not seeing that reflected as much in the gold market to upside,” said Jeff Pritchard, an analyst at Altavest Worldwide Trading.
“It looks like the market maybe got ahead of itself and that correction yesterday put things back in perspective a little bit. I definitely don’t think the uptrend is over, but it might be a little less fierce upside than we’ve seen recently.”
Silver was at $23.80 an ounce against $23.32, having also slipped by the most since July 1 on Tuesday with a 4.1 per cent fall. It is still one of the biggest climbers of the precious metals so far this year, up 41 per cent.
Platinum was at $1,676.49 an ounce against $1,667.50, while palladium was at $584.99 against $573.08.
The white metals also fell on Tuesday in gold’s wake, but analysts say their firm underlying fundamentals are expected to lend support.
Demand for the autocatalyst metals is expected to improve this year as the car industry continues its recovery, while mine supply in South Africa is expected to be constrained. -Reuters
The precious metal fell 2.5 per cent on Tuesday, its biggest one-day loss since July 1, after China raised its benchmark interest rates by 25 basis points, sparking a dollar recovery.
While fresh weakness in the US currency helped prices to rise back above $1,340 an ounce, its move has been relatively muted after Tuesday’s hefty losses.
“We’re seeing a pretty big move in the dollar to the downside and we’re not seeing that reflected as much in the gold market to upside,” said Jeff Pritchard, an analyst at Altavest Worldwide Trading.
“It looks like the market maybe got ahead of itself and that correction yesterday put things back in perspective a little bit. I definitely don’t think the uptrend is over, but it might be a little less fierce upside than we’ve seen recently.”
Silver was at $23.80 an ounce against $23.32, having also slipped by the most since July 1 on Tuesday with a 4.1 per cent fall. It is still one of the biggest climbers of the precious metals so far this year, up 41 per cent.
Platinum was at $1,676.49 an ounce against $1,667.50, while palladium was at $584.99 against $573.08.
The white metals also fell on Tuesday in gold’s wake, but analysts say their firm underlying fundamentals are expected to lend support.
Demand for the autocatalyst metals is expected to improve this year as the car industry continues its recovery, while mine supply in South Africa is expected to be constrained. -Reuters
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