World Economy

Gold Climbs, Yuan Firmer

Gold Climbs, Yuan FirmerGold Climbs, Yuan Firmer

Gold climbed to a 13-month high on Friday before pulling back slightly, as the euro hovered near a three-week peak against the dollar after the European Central Bank signaled it was done reducing interest rates for now.

After rolling out bold measures to boost the eurozone economies, including increased asset buying and a deeper cut to deposit rates, ECB President Mario Draghi on Thursday signaled there would be no further rate cuts, Reuters reported.

Spot gold rose as far as $1,282.51 an ounce, its strongest since Feb. 3, 2015, and was little changed at $1,270.20.

Bullion climbed 1.5% on Thursday, its biggest single-day gain in a week, and was on course for a second weekly rise. For the year, gold has added 20%.

US gold for April delivery eased 0.1% to $1,271 an ounce, after peaking at $1,287.80.

The next major resistance level for gold would be around $1,308, reached in January last year, said Ric Spooner, chief market analyst at CMC Markets in Sydney.

“Ultimately if this trend continues, we may well see ourselves up towards $1,400 in gold,” he said.

Meanwhile, China’s onshore yuan on Friday hit its strongest level against the US dollar in 2016, buoyed by the central bank’s firmest midpoint this year and the greenback’s slide after the European Central Bank suggested it was done cutting rates for now.

Offshore yuan strengthened 0.3% from Thursday to hit its highest level since early December at 6.47 just before midday.

The onshore yuan hit 6.486 in late morning trade, its highest level since Dec. 29. Its previous 2016 peak was 6.488, on Feb 15.

The yuan trimmed some gains to stand at 6.489, 0.28% firmer than the previous close. Friday’s volume was low.

If the yuan closes around the midday level, it would have strengthened 0.2% this week, largely due to Friday’s gain.