Gold gains on coattails of physical demand, Fed policies weigh
Published Dec 27, 2013 11:26AM ET
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,215.10 during U.S. afternoon hours, up 0.23%.
Gold prices hit a session low of USD1,208.60 a troy ounce and high of USD1,218.30 a troy ounce.
Gold futures were likely to find support at USD1,192.20 a troy ounce, Monday's low, and resistance at USD1,251.40, the high from Dec. 16.
The February contract settled up 0.75% at USD1,212.30 a troy ounce on Thursday.
Talk of heightened physical demand in China sent gold prices rising earlier though gains were muted on sentiments that the Federal Reserve's plans to trim USD10 billion from its USD85 billion in monthly bond purchases in January will lead to further cuts to the stimulus program.
Fed bond purchases have elevated gold prices for over a year by suppressing long-term interest rates, weakening the dollar in the process.
Gold and the dollar tend to trade inversely with one another.
Gold prices have already contracted by more than 27% this year on sentiments that the days of ultra-loose monetary policies that have supported the precious metal since 2008 will are slowly coming to an end.
On Thursday, the U.S. Department of Labor reported that the number of individuals filing for initial jobless benefits declined by 42,000 to a seasonally adjusted 338,000 last week.
Analysts were expecting U.S. jobless claims to fall by 35,000 to 345,000 from the previous week’s revised total of 380,000, which was the highest since March.
Elsewhere on the Comex, silver for March delivery was up 0.64% at USD20.043 a troy ounce, while copper for March delivery was down 0.23% and trading at USD3.391 a pound.
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Written By: Investing.com
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