US Gold rises above $1368 after stimulus concerns ease
MUMBAI (Commodity Online): US gold recorded a recovery from its recent bearish rally and recorded a jump on Thursday after US Federal Reserve said that it would maintain its ‘bullion friendly’ monthly bond purchases at $ 85 bn levels. The yellow metal jumped most in 15 months.
Comex gold futures on electronic platform jumped 3.9% to $ 1358.9 per troy ounce for December delivery as of 09.27 IST on Thursday.
The Federal Open Market Committee (FOMC) “decided to await more evidence that progress will be sustained before adjusting the pace of its purchases,” according to a statement from the FOMC on Wednesday after a two day meeting.
On Wednesday, gold prices recorded decline and fell below $ 1300 before the release of FOMC statement on concerns that US Central Bank would start curbing its monetary stimulus later this month on improving economic conditions in the US and around the world.
The Central Bank has stated yesterday, that it requires further evidence that economic conditions in the US have been improving to reduce its monetary stimulus.
Gold recorded a rise of 70% from the end of December 2008 to June 2011 after US Central Bank started its monetary stimulus.
Firm gold demand would determine the yellow metal’s price trend in 2013 and 2014 as investment demand would be declined, said HSBC in its recent report.
HSBC has raised its 2013 average price estimate for gold to $ 1,446 an ounce, up $ 50 from its previous estimate, based on the rise in physical demand.
HSBC left its 2014 and 2015 estimates unchanged at $ 1,435 and $ 1,395, respectively.
Weak data releases from the United States released on Wednesday may have supported the yellow metal prices further in the global market to certain extent today.
Silver futures for December delivery on Globex platform of Comex was seen trading with a gain of $ 1.51 at $ 23.07 per troy ounce as of 09.53 IST on Thursday.
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