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Gold Holds Above 2-Week Low

Gold Holds Above 2-Week LowGold Holds Above 2-Week Low

Gold steadied above a two-week low on Wednesday after US retail sales in March missed market expectations, but a firmer dollar hindered any attempt by investors to push bullion higher.

Spot gold was little changed at $1,193.42 an ounce by 0631 GMT, after touching its lowest in two weeks at $1,183.68 on Tuesday, Reuters reported.

Bullion fell as much as 1.2 percent overnight but pared losses at the close as the dollar retreated after data showing US retail sales rose 0.9 percent in March, just below a market forecast of 1.0 percent. The dollar has since regained some ground.

"The gold market is quite subdued at this time. There's no clear direction. I think we need a clearer catalyst down the road and that will come in the form of the FOMC meeting in two weeks' time," said Howie Lee, an analyst at Phillip Futures.

The Federal Open Market Committee (FOMC) meets on April 28-29, with recent signals from policymakers suggesting the US central bank could still raise interest rates in June despite recent weak economic data.

That has pulled gold back from a recent seven-week high of $1,224.10 an ounce, as a potential rate rise limits the appeal of non-interest-yielding assets.

US gold for June delivery was flat at $1,193.50 an ounce.

Premiums for physical gold on the Shanghai Gold Exchange picked up to $3-$4 an ounce over spot from just above a dollar earlier this week, although analysts say a slowing economy could cap Chinese demand.

 

Financialtribune.com