Gold futures were little changed on Thursday morning in the US, running into resistance above $1,355 despite a weakening dollar.
Gold for December settlement on the Comex division of the New York Mercantile Exchange gained $2.80 or 0.2 percent to $1,352.0 per ounce. Trade has ranged from $1,345.80 to $1,353.90.
Prices have largely moved in concert with the dollar – against a basket of currencies it recently hit a multi-week low and was last trading at 94.56. But investment demand in gold and its potential upside remain capped.
“The rebound in gold prices has been strong but prices have paused ahead of resistance that looks quite formidable between $1,355 and $1,375.25 so upside progress may slow now. But with the dollar looking weaker, we would not be surprised if gold prices work higher. The rest of the precious metals are following gold’s lead,” FastMarkets head of research William Adams said.
Markets are likely to be muted until the next Federal Reserve meeting concludes on September 21. Investors will be keen for any hints or speculation from various Fed members about their thinking on raising interest rates but prediction markets do not project another increase until 2017.
“There is little prospect that the US Fed will raise rates in September, and most likely not in December either,” ICBC Standard Bank’s Tom Kendall said. “If we are wrong, however, gold is vulnerable to a sizeable wash-out of speculative and short-term investment money.”
Earlier today, the European Central Bank kept interest rates unchanged. President Mario Draghi said he sees rates at present levels or lower for a sustained period but expects real GDP to grow at a moderate but steady pace.
In US data, unemployment claims, natural gas storage figures, crude oil inventories and consumer credit are all due for release.
In international markets, Germany’s DAX and France’s CAC-40 were down 0.6 percent and 0.3 percent respectively while the dollar softened by 0.5 percent to 1.1293 against the euro.
As for other precious metals, Comex silver for December settlement rose 8.7 cents or 0.4 percent to $19.935 per ounce. Trade has ranged from $19.845 to $20.020.
Platinum for October delivery climbed 20 cents or 0.1 percent to $1,093.0 per ounce while the most active palladium contract stood at $694.55 per ounce, up $6.20.
(Editing by Mark Shaw)
The post Gold runs into resistance up to $1,375/oz; ECB leaves rates unchanged appeared first on The Bullion Desk.
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Source: Bullion Desk News
