The gold price remained steady above $1,200 late on Friday afternoon although market participants are keeping an eye on the surging dollar.
The spot gold price was last at $1,207/1,208 per ounce, up $12.80 on Thursday’s close. Trade has ranged from $1,193 to $1,210.8.
“Gold or rather euro-denominated gold has broken higher, helping drag US gold and silver, and the PGMs higher too, in spite of an overall strengthening in the dollar,” ICBC Standard Bank analyst Leon Westgate said.
The dollar index remains strong around its highest in three weeks – it was last at around 99.30 having earlier touched 99.69. The US currency has gained following the release of the mildly hawkish minutes from the Match meeting of the US Federal Open Market Committee (FOMC) earlier this week.
These revealed that several members of the policy board judged that the economic data and outlook were likely to warrant the normalization of monetary policy at its June meeting.
“Decent physical demand for gold remains in place, while ETF holdings are also seeing additions, following a near two-million-ounce decline during March,” Westgate added.
In the funds followed by FastMarkets, holdings were last at 1,616 tonnes, down from this year’s peak of 1,676.5 tonnes.
In data, the Chinese CPI was steady in March at 1.4 percent but beat the expected 1.3 percent. While producer prices remain in negative territory, there was an improvement to -4.6 percent from the previous -4.8 percent – commodity price weakness is weighing on production prices.
The French government budget balance came in at 23.4 billion euros, better than from the previous reading of -9.4 billion euros, while French industrial production at 0.0 percent was better than the expected -0.1 percent. Data out later includes US import prices and the Federal budget balance.
From the US import prices at -0.3 percent were better than the previous reading of 0.2 percent. The US Federal budget balance is due at around 1800 London time.
In the other metals, silver was last at $16.53/16.58 per ounce, up 36 cents. Platinum at $1,166/1,176 was up $15 and palladium climbed $13 to$773/778, supported by news that Russia is implementing a 6-5 percent export tax on all forms of platinum rather than just powder and ingots.
The tax is likely to be temporary given that Russia’s WTO commitments mean that it should cancel its taxes on PGMs from 2016, Westgate noted.
(Editing by Mark Shaw)
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