Publications
Partners
Singapore - Gold prices took a breather on Monday after a more than 1% rise in the previous session, as investors closely watched oil and currency markets for further trading cues.
Bullion prices posted the biggest one-day rise so far this month on Friday, reflecting higher oil prices and a sharp fall in the dollar as a result of disappointing US housing market data.
Spot gold has lost nearly 2% so far this month, and may remain under pressure from a brighter US economic recovery, high real interest rates and sluggish physical demand, said traders.
“There is no rush to buy gold,” said Ronald Leung, a dealer at Lee Cheong Gold Dealers in Hong Kong.
“We are seeing slower economic growth accompanied by easing inflation in China, which dampens interest in buying gold.”
Spot gold was little changed at $1 662.29 an ounce by 06:29 GMT, after hitting a one-week high of $1 669.26 in early hours. US gold was barely changed at $1 662.20.
Money managers in US gold futures and options cut their bullish bets for a third straight week to the weakest level in two months as bullion prices tumbled after a strong run of US economic data triggered fund selling.
Physical demand from India, the world’s largest bullion buyer, remains a concern with a jewellers’ strike entering its second week after the government announced a hike in import duty on bullion.
The dollar index edged up from a two-week low hit on Friday, dampening sentiment on dollar-priced commodities by making them more expensive for buyers holding other currencies.
A recent string of upbeat US economic data, a strong rally on Wall Street and a surge in US Treasury yields have cooled investor interest in gold, but some analysts believe gold’s rally has not yet run its course.
“There’s a good chance we’ll see a relapse in US data since the economy is in a fragile recovery, which will lead to speculation on more quantitative easing, and that is positive for gold,” said Hou Xinqiang, an analyst at Jinrui Futures in the southern Chinese city of Shenzhen.
Hou said oil prices are unlikely to slide easily from current high levels given the sticky situation in Iran, another supportive factor for gold.
Bullion prices posted the biggest one-day rise so far this month on Friday, reflecting higher oil prices and a sharp fall in the dollar as a result of disappointing US housing market data.
Spot gold has lost nearly 2% so far this month, and may remain under pressure from a brighter US economic recovery, high real interest rates and sluggish physical demand, said traders.
“There is no rush to buy gold,” said Ronald Leung, a dealer at Lee Cheong Gold Dealers in Hong Kong.
“We are seeing slower economic growth accompanied by easing inflation in China, which dampens interest in buying gold.”
Spot gold was little changed at $1 662.29 an ounce by 06:29 GMT, after hitting a one-week high of $1 669.26 in early hours. US gold was barely changed at $1 662.20.
Money managers in US gold futures and options cut their bullish bets for a third straight week to the weakest level in two months as bullion prices tumbled after a strong run of US economic data triggered fund selling.
Physical demand from India, the world’s largest bullion buyer, remains a concern with a jewellers’ strike entering its second week after the government announced a hike in import duty on bullion.
The dollar index edged up from a two-week low hit on Friday, dampening sentiment on dollar-priced commodities by making them more expensive for buyers holding other currencies.
A recent string of upbeat US economic data, a strong rally on Wall Street and a surge in US Treasury yields have cooled investor interest in gold, but some analysts believe gold’s rally has not yet run its course.
“There’s a good chance we’ll see a relapse in US data since the economy is in a fragile recovery, which will lead to speculation on more quantitative easing, and that is positive for gold,” said Hou Xinqiang, an analyst at Jinrui Futures in the southern Chinese city of Shenzhen.
Hou said oil prices are unlikely to slide easily from current high levels given the sticky situation in Iran, another supportive factor for gold.
