MTECHTIPS:-Gold prices rebound in Asia with focus on China demand prospects Gold prices rebounded in Asia on Thursday with the market focused on physical demand prospects from China.Overnight, gold prices fell after a strong report on U.S. durable goods solidified expectations for the Federal Reserve to wind down monthly asset purchases this year and begin raising benchmark interest rates in 2015.On the Comex division of the New York Mercantile Exchange, goldfutures for June delivery traded at $1,305.30 a troy ounce, up 0.15%, after hitting an overnight session low of $1,300.90 and off a high of $1,316.90. The dollar rose after the Commerce Department reported that U.S. durable goods orders rose 2.2% last month, wiping out two months of declines and surpassing expectations for a 1.0% increase. Core durable goods orders, which exclude transportation items, inched up 0.2%, slightly below forecasts for a 0.3% gain. The overall data indicated that economy is gaining momentum and brushing off a weather-related slowdown and cemented expectations for the Fed to wind down its monthly asset-purchasing program this year and hike interest rates the next. The Feds asset-purchasing program, currently set at $55 billion in Treasury and mortgage debt a month, weakens the dollar by suppressing long-term interest rates. Meanwhile across the Atlantic, the euro continued to come under pressure stemming from dovish comments from ECB officials on Tuesday, indicating that the monetary authority is mulling policy options to stave off deflationary risks. Also on Wednesday, a widely-watched German consumer climate gauge remained unchanged last month. In a report, research group Gfk said that its forward-looking index of Germany’s consumer climate remained unchanged at 8.5 for April from March, in line with market expectations. The weaker euro bolstered the dollar, which further cut into golds performance on Wednesday, as the greenback and the yellow metal tend to trade inversely with one another.
Posted on: Thu, 27 Mar 2014 11:55:42 +0000
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