Gold gained in late European trade on Thursday on speculative buying after the release of the US consumer price data had little impact on the dollar. Firmer oil prices also helped gold, but analysts said the metal was expected to continue trading in a range in the coming trading sessions.
"It's basically range-trading. Gold needs to be lifted above $640 to be really bullish," Wolfgang Wrzesniok-Rossbach, head of precious metals marketing at Germany's Heraeus, said.
"There is no support from the physical market. It's basically driven by speculative forces at the moment and they are technically driven and look very much on the dollar and oil," he said.
Spot gold hit an intraday high of $628.10 an ounce but eased to $624.90/$625.65 an ounce by 1543 GMT, against $623.70/$624.35 an ounce late in New York on Wednesday.
The dollar was a touch firmer against the euro but steady versus the yen as the market digested data showing benign US price pressures.
Oil rose near $59 a barrel after a larger-than-expected draw in US fuel stocks and on signs that Opec may cut production again next month. Gold is often seen as a hedge against inflation and generally moves in the opposite direction of the dollar.
"Consolidation continues to appear to be the major theme in the gold market at present, with prices lacking momentum to push towards recent highs but appearing to have established themselves quite comfortably above the $600/oz," Barclays Capital said in a daily note.
Gold dropped to its lowest in nearly a week around $615 on Wednesday as the dollar firmed after the US central bank said in minutes of its October meeting that reducing inflation was its "greatest concern". "Although managing to pare potentially sharp losses in intraday trade, the yellow metal is likely to remain somewhat range bound as it struggles to break into new trading ranges," Standard Bank said in a report.
Other precious metals gained, with platinum rose to $1,193/1,198 an ounce from $1,168/1,172 in New York. Silver rose to $13.01/13.08 an ounce from $12.88/12.95, while palladium was at $318/323 an ounce, up from $315/320.
Comments
Comments are closed.