Gold prices dip in early Asia with Yellen speech ahead this week
Singapore (Mar 28) Gold prices eased in Asia on Monday with investors eyeing a speech later in the week by Federal Reserve chief Janet Yellen. Gold for April delivery on the Comex division of the New York Mercantile Exchange fell 0.65% to $1,215.60 a troy ounce.
Also on the Comex, silver futures for May delivery were mainly flat at $15,200 a troy ounce, while copper futures for May delivery rose 0.04% to $2.238 a pound.
In the week ahead, market players will be turning their attention to a highly anticipated speech by Federal Reserve Chair Janet Yellen on Tuesday for further clues on the timing of the next U.S. rate hike.
Besides Yellen, there are other Fed speakers in the coming week, including New York Fed President William Dudley on Thursday and Cleveland Fed President Loretta Mester on Friday.
March nonfarm payrolls data and the March ISM manufacturing report, both due Friday, will also be in focus, as investors attempt to gauge if the world's largest economy is strong enough to withstand further rate hikes in 2016.
Traders will also be looking out for data on China's manufacturing sector due on Friday, amid ongoing concerns over the health of the world's second biggest economy.
Markets in Australia, Hong Kong, London, Frankfurt, Paris and Milan will be closed for Easter Monday.
Later on Monday, the U.S. is release data on personal spending, pending homes sales and the goods trade balance.
Last week, gold prices fell to a four-week low on Thursday, as hawkish comments from a handful of Federal Reserve officials sparked speculation that the U.S. central bank could give serious consideration to a rate hike at its April meeting, boosting the U.S. dollar.
Metals trading on the Comex remained closed Friday in observance of the Good Friday holiday. For the week, gold prices declined $32.40, or 2.58%, the third straight weekly loss and the biggest since November.
St. Louis Fed President James Bullard added his support to the possibility of more U.S. interest rate hikes this year on Thursday, with the first perhaps as soon as April.
The hawkish comments follow similar remarks made by Philadelphia Fed President Patrick Harker, Chicago Fed President Charles Evans, San Francisco Fed President John Williams and Atlanta Fed President Dennis Lockhart earlier in the week.
The prospect of more U.S. interest rate rises this year bolstered the dollar against its major rivals. The dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose to a one-week high of 96.39 on Thursday.
It ended the holiday-shortened week with a gain of 1.1%, its first such gain this month. A stronger dollar makes U.S. commodities more expensive for buyers holding other currencies.
Despite recent losses, prices of the yellow metal are up nearly 14% so far this year as investors seek safe havens in the face of mounting instability in other financial markets and as fears over a China-led global economic slowdown make it tougher for the Fed to raise rates.
The U.S. central bank surprised markets earlier this month by cutting its rate hike projections more than expected, down from four to two in 2016, citing the potential impact from weaker global growth and financial market turmoil on the U.S. economy.
Source: Investing.com
