Gold set to finish week almost unchanged
Singapore (Feb 21) Gold edged down on Friday, pressured by a firmer dollar and following a rise of almost 1% in the previous session, but the precious metal was close to flat for the week after two weeks of gains on a patchy recovery in the global economy.
Gold has gained more than 9% so far this year as concern over economic growth has boosted its safe-haven appeal, although prices are nowhere near the all-time high of about $1,920 an ounce touched in 2011.
Cash gold eased $5.46 an ounce to $1,317.05 by 3.45am GMT, down from a three-and-a-half-month high at $1,332.10 hit on Tuesday. Dealers saw purchases in the physical market this week, but many jewellers could be waiting for a correction.
Premiums for gold bars were steady in Hong Kong and Singapore, but dropped in Tokyo because of gains in Tokyo gold futures.
"I think $1,330 is pretty much toppish for a while. There’s not much incentive at the moment, except for the dollar movements," Standard Bank branch manager Yuichi Ikemizu said in Tokyo.
He expected gold to trade in a range of $1,300-$1,335. "I think (the price) is a little bit too high for Asians to buy gold because we’ve been below $1,300 for a long time and people bought a lot."
US gold was little changed at $1,317.10 an ounce. Trading was cautious after minutes of the Federal Reserve’s latest policy meeting showed several policy makers wanted to keep cutting monetary stimulus, which could dent gold’s appeal as a hedge against inflation.
A rosy survey on factory activity in the US gave Asian share markets an early boost on Friday, though underlying concern about China’s economic growth kept investors from rushing to buy riskier assets.
The US dollar index against a basket of currencies rose to 80.29 from a eight-week low of 79.927 hit on Wednesday.
In the physical market, premiums for gold bars in Tokyo slipped to zero from 30c an ounce to the spot London prices last week. Premiums in Singapore were little changed at $1.20-$1.50; Hong Kong premiums were at $1.30-$1.70.
"Gold price in Japanese yen is basically going up, so at this moment, we are seeing a bit of selling from the general public," said a dealer in Tokyo, referring to retail investors.
Holdings of the largest gold-backed exchange-traded-fund (ETF), New York’s SPDR Gold Trust GLD dropped 0.70% on Wednesday from Tuesday, and the largest silver-backed ETF, New York’s iShares Silver Trust SLV, was unaltered during the same period.
Source: bdlive-SA
