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Monthly Archives: May 2015

PRECIOUS-Gold edges up on softer dollar, uncertainty over Greece

Gold edged up on Friday from the previous day’s 2-1/2-week low, supported by a softer dollar and uncertainty over Greece’s debt talks, but remained under pressure from expectations U.S. interest rates might rise soon.

The prospect of higher rates, which would boost the opportunity cost of holding non-yielding gold while lifting the dollar, kept the metal on track for a second weekly drop.

Spot gold was up 0.3 percent at $1,190.70 an ounce at 2:33 p.m. EDT (1833 GMT), on track to close May up 0.6 pct, the second straight small monthly increase. U.S. gold futures for June delivery settled up $1.30 an ounce at $1,189.40.

“The gold market will eventually have to discount the fact that the Fed is not going to put through a series of rate hikes, one after the other, but will rather just put in one in and wait,” said Edward Meir, INTL FCStone analyst.

“If it does that, I think the market should respond by moving a bit higher. In the meantime, we’re in this drift doing nothing.” (more…)

PRECIOUS-Gold holds above 2-1/2-week low but set for second weekly drop

Gold was hovering above a 2-1/2-week low on Friday as the dollar gave back some of its recent gains, but the metal was still headed for a second straight weekly decline on the prospect of higher U.S. interest rates.

Spot gold was little changed at $1,187.90 an ounce by 0646 GMT. It fell to a 2-1/2-week low of $1,180.55 on Thursday but recovered slightly as the dollar and stocks weakened. The metal is still down 1.5 percent on the week.

The dollar edged down in early Asian trading, taking a breather from this week’s rally that brought it to its highest level against the yen since 2002 on growing expectations that the U.S. Federal Reserve will raise interest rates this year.

“The gold market looks set to continue to trade in a $1,180-$1,195 range with a break to the downside looking more likely in line with the surging dollar,” said Jason Cerisola, a trader at MKS Group. (more…)

PRECIOUS-Gold hovers near 2-week low on firm dollar, US rate outlook

Gold struggled to recover from a two-week low on Thursday as a robust dollar and the prospects of higher U.S. interest rates dented demand for the metal.

Spot gold was little changed at $1,188.55 an ounce by 0647 GMT. The metal hit a two-week low of $1,183.76 in the previous session, but pared losses to end flat for the day.

Silver on Wednesday also hit a low of $16.55 an ounce, its lowest since May 13.

“Gold and silver flounder against a backdrop of no major data releases to give price guidance and sluggish physical demand,” HSBC analyst James Steel said.

There has been no major U.S. data release since Tuesday data showing strong core business spending, new home sales and consumer confidence.

Gold fell 1.7 percent on Tuesday, its sharpest one-day drop since April, as investors believed the robust data would prompt the Federal Reserve to soon raise interest rates. (more…)

PRECIOUS-Gold bounces up from 2-1/2-week low as dollar, shares fall

Gold inched higher after hitting a 2-1/2 week low on Thursday as the dollar and global shares fell alongside uncertainty about Greece and an unexpected rise in U.S. jobless claims.

Spot gold was up 0.1 percent at $1,188.30 an ounce by 2:26 p.m. EDT (1826 GMT) after falling to $1,180.55, the lowest since May 11. U.S. gold futures for June delivery settled up $2.50 at $1,188.10 an ounce.

European Central Bank Vice President Vitor Constancio underlined the gravity of the situation facing Greece, talking openly about a possible default that would be the first of its kind in the eurozone.

A worsening of the Greek debt crisis could trigger demand for gold coins and bars. Gold is usually seen as a hedge against political and financial risk, although the impact on demand from wider political worries is usually short-lived.

The dollar turned down 0.2 percent against a basket of currencies. (more…)

PRECIOUS-Gold holds near 2-week low as US rate hike looms

Gold held near a two-week trough on Wednesday after sliding almost 2 percent in the previous session as upbeat U.S. economic data strengthened expectation that the Federal Reserve may be on course to raise interest rates this year.

The dollar also held on to broad gains following a rally that pushed bullion to its steepest single-day fall since April 30.

Spot gold was up 0.3 percent at $1,189.65 an ounce by 0635 GMT. It dropped to $1,185.35 on Tuesday, its weakest since May 12.

“I think the Fed would raise rates at least once this year and it’s likely in September,” said Howie Lee, an analyst at Phillip Futures.

While recent data suggested that U.S. economic activity was picking up after a first-quarter slack, Lee said the overall picture remains soft and the Fed may need more evidence before raising rates.

“There could be unwarranted optimism on the U.S. economy and I think we still need a few more months of solid data before we can conclude that the rebound is in place,” he said. (more…)

PRECIOUS-Gold drops almost 2 percent as dollar rally continues

Gold dipped almost 2 percent on Tuesday as the dollar extended gains following a raft of strong U.S. data and recent comments from Federal Reserve Chair Janet Yellen that reinforced the central bank’s tightening bias on monetary policy.

Spot gold dropped to a two-week low of $1,185.35 an ounce earlier and was down 1.7 percent at $1,186.90 by 2:19 p.m. EDT (1819 GMT), its biggest drop since April 30.

U.S. gold futures for June delivery settled down $17.10 at $1,186.90 an ounce.

“Intriguingly, gold has failed to find much if any demand from safe haven buying today despite the sharp drop in European and U.S. equity markets,” said Fawad Razaqzada, technical analyst for Forex.com.

“This, we think, argues against a sharp recovery now.”

The dollar rallied 1.3 percent against a basket of leading currencies, after data showed U.S. business investment spending plans increased solidly for a second straight month in April. (more…)

PRECIOUS-Gold dips on robust dollar, Yellen comments on rate hike

Gold edged lower on Monday as the dollar strengthened to a one-month high on signs the Federal Reserve is readying to raise interest rates for the first time in six years in 2015.

In a speech to a business group on Friday, Fed Chair Janet Yellen indicated the U.S. central bank was poised to raise rates this year as the world’s largest economy was set to bounce back from an early-year slump and headwinds at home and abroad waned.

Higher U.S. interest rates would increase the opportunity cost of holding non-yielding bullion.

Spot gold was down 0.1 percent at $1,204.46 an ounce by 0847 GMT, just above a near-two-week low of $1,201.20 hit in the previous session. It posted its biggest weekly drop in a month last week, down 1.4 percent.

Liquidity was likely to remain thin on Monday as British and U.S. markets are shut for holidays.

“The Fed raising the rates is certainly not a electrifying news for the precious metal, which is on track to extend its biggest weekly decline since April,” AvaTrade chief market analyst Naeem Aslam said.

“Yellen last week has confirmed that she is still confident that the rates will rise this year and gold traders are not fond of this news at all.” (more…)

UPDATE 1-PRECIOUS-Gold edges up as Yellen comments shore up dollar

Gold prices rose sightly on Monday, even as the dollar gained traction against major currency rivals on signs the U.S. Federal Reserve is preparing to tighten monetary policy for the first time in six years in 2015.

Fed Chair Janet Yellen indicated on Friday that the U.S. central bank was poised to raise rates this year, with the world’s largest economy set to bounce back from an early-2015 slump.

Higher U.S. interest rates increases the opportunity cost of holding non-yielding bullion.

Spot gold was up 0.2 percent at $1,206.80 an ounce by 1826 GMT, just above a near-two-week low of $1,201.20 hit in the previous session. It posted its biggest weekly drop in a month last week, down 1.4 percent.

Liquidity was thin with British and U.S. markets shut for holidays. (more…)

PRECIOUS-Gold falls as Yellen points to rate hike, dollar jumps

Gold eased on Friday, on course for its first weekly decline in four weeks, after U.S. Federal Reserve Chair Janet Yellen said she expected an interest rate hike this year.

The dollar extended gains following the speech, after initially climbing on a stronger-than-expected rise in U.S. core consumer prices in April.

Yellen said she expected the central bank to raise rates this year as the U.S. economy was on course to bounce back from a sluggish first quarter and as headwinds at home and abroad begin to wane.

Spot gold, higher initially, fell 0.1 percent to $1,204.72 an ounce by 3 p.m. EDT (1900 GMT). It was down 1.6 percent for the week. U.S. gold futures for June delivery were little changed, settling down 10 cents at $1,204 an ounce.

The market was quiet ahead of public holidays on Monday in Britain and the United States. (more…)

Austrian central bank to repatriate gold from Britain – Krone newspaper

May 22 Austria’s central bank plans to repatriate some of its gold reserves from Britain after facing criticism for storing too much of the precious metal abroad, the Krone newspaper reported on Friday without naming any sources for the information.

Officials at the Austrian National Bank (OeNB) were not immediately available for comment.

The OeNB in February rejected criticism of its gold storage policy by the country’s Court of Audit and insisted that keeping the bulk of reserves in London was in the country’s best interests, but also said a policy review was under way.

The central bank, which administers Austria’s 280 tonnes of gold reserves, had argued it makes sense to store gold where it can be traded if need be, which made London a logical place given its role as an international market for the metal.

Austrian gold reserves have been unchanged since 2007, according to the OeNB’s 2013 annual report, which says around 80 percent is kept in Britain, 17 percent in Austria and 3 percent in Switzerland.

Krone said in future 50 percent would be kept in Austria, 30 percent in Britain and 20 percent in Switzerland.

PRECIOUS-Gold edges lower as dollar cuts losses after U.S. data

Gold fell on Thursday as the dollar cut losses on U.S. data that showed growing economic momentum, but support came from signs the Federal Reserve was unlikely to raise interest rates in June.

The number of Americans filing new claims for unemployment benefits rose slightly more than expected last week, data on Thursday showed. But the four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 5,500 last week to 266,250. That was the lowest level since April 2000.

Spot gold was down 0.3 percent at $1,205.28 an ounce by 2:43 p.m. EDT (1843 GMT), while U.S. gold futures for June delivery settled down 0.4 percent at $1,204.10 an ounce.

“We had a good run-up and every rally is seen as an opportunity to take profits” in the last 18 months, Ross Norman, chief executive of broker Sharps Pixley, said. “The market remains elastic, (with) good buying on the dips and selling on the rallies.” (more…)