Gold Prices Slightly Up as Dollar Falls; Silver Prices Slip
Gold prices inched higher and were on course to post gains for the second straight week as the U.S. dollar traded broadly weaker after a data release from the New York Fed showed that manufacturing activities in the New York State contracted more-than-expected. Silver prices, meanwhile, edged lower on Friday.
In addition, lack of inflationary pressure in the U.S. has dispelled fears of any early exit of the Federal Reserve’s QE3.
The Labor Department’s Consumer Price Index (CPI) rose to 0.7% in February; however, analysts suggest that the inflation wasn’t a concern at the moment as core inflation rate (CPI excluding energy and food items) rose by mere 0.2% against 0.3% increase in the previous month. This implies that the Federal Reserve will be not be pressed to squeeze or halt its ongoing monetary easing measures, which is supportive for gold as its inflation hedge appeal will stay intact.
At last check, U.S. gold futures for April delivery inched up 0.01% $1590.90 while spot gold gained 0.15% to $1592.20 an ounce.
Silver futures fell 0.11% to $28.775 an ounce.
The euro, which slumped to its three months low against the U.S. dollar in the previous session, also rebounded sharply after unexpectedly weak economic data releases from the U.S.
Earlier today, Thomson/Reuters University of Michigan’s preliminary reading on the consumer sentiment slipped to 71.8 in early March, a lowest reading since December 2011. Economists forecast were for reading of 78.
“The strength in the gold price is also driven by the euro/dollar, which has been quite high throughout the day,” said Christin Tuxen, an analyst at Danske Bank, according to Reuters.
“We see this rebound continuing in the short term, and this may reflect some near-term upside for gold,” added Tuxen.
Holdings of SPDR Gold Trust (ETF) (NYSE: GLD), world’s largest gold backed ETF, fell by 3.432 tons thus far this week – and were on course to post 11th week of declines, showed a data provided by Reuters.
More Posts by this author
- Stocks Finish Lower as Concerns Over Cyprus Weigh Down Sentiment
- Gold Prices Gain Tractions as Investors Fret over Cyprus Bailout Deal; Silver Prices also Edge Higher
- Stocks Pare Losses But Still in Red Territory
- Forex Market Update: Euro Slumps to More than Three-Month Low against the U.S. Dollar
- U.S. Stocks Tumble as Investors Keep an Eye on Cyprus Bailout Agreement
- Gold Prices Breach $1600 Mark On Cyprus Bailout Concerns; Silver Prices Fall
- U.S. Stocks Futures Tumble as Cyprus Bailout Deal Keeps Investors Edgy
 |
Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
|
