Gold steadied on Thursday while investors eyed US data about potential signals, but the sentiment remains weak as optimism regarding the economic recovery and a strong US dollar bumpy appeal of bullion as hedging.
Gold remained down near $1,160 as the Federal Reserve is preparing to raise interest rates next year, while other national central banks raise stimulus, the strengthening dollar. Assets in the SPDR Gold Trust posted the longest decline in 16 months.
Spot gold stood at $1161.32 an ounce at 0344 GMT, after easing 0.3 percent from the previous session.
The metal has viewed an intense wave of sales versus October 31 slip below key technical level of $ 1,180 and then plumbing down 4-1 / 2 years at $ 1131.85. It has recovered since modestly on short covering.
Bullion for prompt delivery dropped as much as 0.5 percent to $ 1,156.72 an ounce and was trading at $ 1163.60 in Singapore.
The Bloomberg spot dollar index is trading close to up to five years as the first rate hike in the United States since 2006 is likely next year, while central banks in Europe and Japan have increasingly taking steps in supporting growth .
US Weekly unemployment claims are expected later in the day and may give clues over the strength of the economy. The recovery is currently being closely continued because it would affect the decision of the US Federal Reserve to raise interest rates.
The highest rates could hurt non-interest bearing gold and boost the dollar. Bullion, viewed as an alternative to risky assets investment over with economic uncertainty, tends to fall when the dollar and stocks are strong.
Holdings in SPDR Gold Trust, backed exchange-traded on the world’s largest gold fund fell 0.25 percent to 722.67 tonnes on Wednesday – the seventh consecutive day of declines.
The holdings are also the lowest in six years. The ETF is seen as reflects well on market confidence because of its size.
Bullion traders were also paying much attention to in the oil markets. Brent crude traded around $ 80 a barrel on Thursday, near its lowest level since 2010 after OPEC said demand for its oil would fall next year and Saudi Arabia stayed silent about a possible cut in production.
Worldwide demand for Gold tumbled to its lowest level in nearly five years in the third quarter as China purchases slid by any third party said the World Gold Council on Thursday, replacing it behind India as consumer the world’s largest gold.
After falling much more MCX gold is trying to recover. The dollar index is at a height of 4 years, as of still buying trend on gold. Domestic bullion market is trying to move towards Rs 26,000. The positive trend in silver and the price is close to Rs 35,000.
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