Gold up on soft dollar and poor US data

Otmane El Rhazi from The Bullion Desk.

Gold prices soared to a five-week high on Wednesday as US data disappointed and the weak dollar provided lift.

Gold for June delivery on the Comex division of the New York Mercantile Exchange rose $25.80 to close at $1,218.20 per ounce. Trade ranged from $1,190.4 to $1,218.5.

In US data, core retail sales month-over-month in April were up 0.1 percent, off the 0.4 percent forecast, while retail sales month-over-month for April was unchanged, missing the estimates of 0.3 percent.

Even more pronounced, April import prices month-over-month were down 0.3 percent, in opposite direction of the 0.3 percent increase forecast. Gold spot price 100-day moving average was $1,211.1.

“Precious metals rallied this afternoon on the back of worse than expected US retail sales for April,” Triland Metals said. “With the headline figure coming in at 0.0 percent vs 0.2 percent gold broke through a previous highs and short term trend lines dating back from the end of March. As exciting as this move was in the short term, the market remains range stuck in the same range for much of the last two months.”

Meanwhile in the eurozone, flash GDP quarter-over-quarter rose 0.4 percent, slightly below the 0.4 percent estimate. Industrial production month-over-month in March was down 0.3 percent, while forecasters pegged a 0.1 increase.

While in Asia, Chinese new loans for April was 708 billion, below the estimates of 1.21 trillion. April M2 money supply year-over-year in April was up 10.1 percent, off the 11.9 percent forecast.

In US equities, the Dow Jones industrial average and S&P were near unchanged. The euro was 1.3 percent stronger at 1.1363 against the dollar.

In other precious metals, Comex silver for July delivery was up six cents at $17.135 per ounce. Trade has ranged from $16.48 to $17.140.

Platinum for July delivery on the Nymex increased $16.5 to $1,149.5 per ounce while the most actively traded palladium contract was at $788.75, up $3.60.

Light sweet crude (WTI) oil futures on the Nymex were last down $0.58 or 0.9percent to $61.15per barrel.

(Editing by Tom Jennemann)

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