Gold Heads for Biggest Weekly Jump Since June on Slowdown Signs Gold held near a two-week high, on course for the biggest weekly increase since June, as concern that the global economy may be faltering stoked speculation of more stimulus, boosting demand for a store of value. Gold for immediate delivery traded at $1,224.25 an ounce by 8:43 a.m. in Singapore from $1,224.33 yesterday, according to Bloomberg generic pricing. Bullion rose to $1,233.43 yesterday, the highest since Sept. 23, after minutes of the Federal Reserve’s last meeting showed officials expressed concern the U.S. economy may be at risk from a global slowdown. Gold is 2.8 percent higher this week, set for the biggest such advance since the period to June 20, and a fifth day of gains today would be the longest run since February. The Bloomberg Dollar Spot Index is poised to halt a seven-week rally as investors assessed the timing of increases in U.S. interest rates, which the Fed has pledged to hold near zero for a “considerable time.” “Investors are probably looking for stimulus again,” said Jonathan Barratt, the Sydney-based chief investment officer at Ayers Alliance Securities. “The weak dollar is also helping to squeeze shorts,” he said, referring to unwinding of bets on falling prices. Gold has rallied from this year’s low of $1,183.24 on Oct. 6 as haven demand increased. The International Monetary Fund this week cut its outlook for global growth in 2015. European Central Bank President Mario Draghi pledged yesterday to expand stimulus measures if needed, while Governor Haruhiko Kuroda said the Bank of Japan has many options for additional easing. Margin Cut Gold for December delivery traded at $1,224.70 an ounce on the Comex in New York from $1,225.30 yesterday, when futures rose 1.6 percent. CME Group Inc. cut the margin requirements on gold, silver and platinum trading, reducing the minimum cash deposit for speculators to $4,000 per 100-ounce gold contract at the close today. Investors boosted short positions in futures and options for a seventh week to the highest since at least 2006 in the week ended Sept. 30, U.S. government data show. Holdings in the SPDR Gold Trust, the biggest gold-backed exchange-traded product, were unchanged yesterday at 762.08 metric tons, the least since December 2008. Silver for immediate delivery traded at $17.3594 an ounce from $17.3686 yesterday, set to snap five weeks of losses. Spot platinum fell 0.7 percent to $1,264.88 an ounce and palladium dropped 0.2 percent to $793.75 an ounce, with both metals on course for the first weekly increase in six.
Posted on: Fri, 10 Oct 2014 11:20:53 +0000
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