Gold surges in Europe

Gold prices rose to a one-week high on Wednesday on technical trading and as the dollar held near three-week lows even as risk appetite lifted stocks. Spot gold was up 0.3 percent at $1,351.08 per ounce by 1356 GMT, after touching its highest since April 11, while US gold futures for June delivery were 0.5 percent higher at $1,356.
Gold broke above $1,350, a significant resistance level for gold, said Activtrades chief analyst Carlo Alberto De Casa, and a close above this level would confirm positive momentum for gold. "If gold can remain above the $1,350 level for a couple of days there is a good chance to see it jumping up to $1,400," he said. Kitco Metals senior analysts Jim Wyckoff said the chart positions for gold and silver are "tilted in favour of the bulls, which is inspiring technically-based buying interest at mid-week".
The dollar index, which measures the greenback against a basket of currencies, eased towards a three-week low reached on Tuesday. A weaker greenback makes dollar-priced gold cheaper for holders of other currencies. Losses in the dollar were capped by a weaker pound which fell to a four-day low on Wednesday after British inflation unexpectedly cooled to a one-year low in March.
Robust earnings from Netflix, Morgan Stanley and Goldman Sachs this week capped gains in non-interest yielding gold and lifted stocks. The sterling tumbled after British inflation unexpectedly cooled to a one-year low in March, according to figures that may raise doubt over bets that the Bank of England will raise interest rates in May.
In physicals, Sri Lanka imposed a 15 percent tax on imported gold with effect from Wednesday to prevent illegal smuggling of the metal from the island nation, a finance ministry official said. Meanwhile, spot silver climbed 1.8 percent to $17.05 per ounce, after touching its highest since February 2 at $17.14 an ounce. Platinum gained 1.2 percent to $941.10 per ounce, after hitting a three-week high of $945.10.
Palladium rose 2.2 percent to $1,034.80 per ounce, having touched its highest since March 1. The metal used in autocatalysts in cars was spurred by fears of Russian supply disruptions after the United States' recent imposition of sanctions on shareholders of Nornickel, the world's largest producer. "We believe the recent rally is mainly driven by speculation and the gains are on a weak footing," Julius Baer said, adding that sanctions were unlikely to be extended to Nornickel itself because the United States needs palladium.