New York gold futures ended higher on Friday after data showed that US core inflation rose more than expected in April, bolstering the status of gold as a hedge against inflation. However, when food and energy are included, US consumer prices were unchanged in April from March.
GOLD: Gold for June delivery settled up $2.90 at $931.30 an ounce on the COMEX division of the New York Mercantile Exchange. A narrow range from $924.10 to $934.80. Gold futures largely ignored news that China should boost its gold holdings to 3 percent of its total foreign exchange reserves within five years, compared with 1.6 percent now, according to the China Gold Association.
Late April, China revealed that it had secretly raised its gold reserves by three-quarters since 2003, increasing its holdings to 1,054 tonnes and confirming years of speculation it had been buying. June futures strengthened after data showed that US core prices, which exclude food and energy items, rose a faster-than-expected 0.3 percent in April, even though headline inflation figure was flat.
Buying in the gold market based on worries of higher inflation has been a steady factor in the last several months - analysts. Market sentiment improved after AngloGold Ashanti, the world's No 3 producer, said it promised to cut its hedge book by up to an additional 150,000 ounces in this quarter.
As more signals of recovery in economic conditions emerge, bullion prices are likely to slide because of less appetite to hoard gold - Pradeep Unni, trader at Richcomm Global Services. Gold-oil ratio at 16.41, higher than the 16.02 of its previous session. COMEX estimated final volume at 110,979 lots. Spot gold traded at $930.70 an ounce at 3:45 pm EDT (1945 GMT), up 0.6 percent from its late Thursday quote in New York.
SILVER: COMEX July silver ended down 3.00 cents at $14.01 an ounce in quiet trade, tracking gold's strength. Ranged from $13.86 to $14.19. COMEX estimated final volume at 15,622 lots. Spot silver was at $13.99 an ounce, down 0.1 percent from its previous finish.
PLATINUM: NYMEX July platinum finished down $8.50 at $1,109 an ounce based on a gloomy outlook for auto sector demand. Spot platinum at $1,099.00 an ounce, down 1 percent from its late Thursday quote.
PALLADIUM: June palladium closed up $1.10 at $226.95 an ounce on bottom fishing after recent sharp decline. Spot palladium was at $221.00 an ounce, down 1.1 percent from its previous finish.