Gold prices fell earlier in the session but clawed back above $1,060 an ounce Wednesday as oil rallied and the euro rose above $1.50 for the first time in 14 months after U.S. corporates came out with better than expected earnings report. Silver outperformed gold, rising by 1.52 percent.
IN FOCUS:
- The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said its holdings stood at 1,109.314 tonnes as of Oct.15, unchanged from the previous business day.
- Gold prices have been tracking the euro-dollar exchange rate, with gold reaching record highs of $1,070.40 last week as the dollar hit its lowest level in over a year versus the single currency.
- The dollar touched a one-month low against sterling and the euro broke above $1.50 as expectations for low U.S. interest rates weighed on the greenback.
- ETF Securities said in a note that its assets under management in its U.S. Physical Swiss Gold Shares and Physical Silver Shares had exceeded $350 million within two months of their inception.
- India's gold sales for the Dhanteras festival could have risen up to 30 percent from a benchmark, as consumers expecting the near-record prices to rise further bought freely. Dhanteras, celebrated last Thursday, is India's biggest gold-buying day and generally accounts for sales of 15-40 tonnes in the world's biggest market, according to various trade estimates.
- Gold investors in India, the world's largest consumer, are likely to outstrip jewellery buyers in 2-3 years with the economy on the rebound and buyers seeking new ways to protect their investments from pilferage.
FUNDAMENTAL OUTLOOK:
Gold is trading just below $1060 per Oz on COMEX today. It is expected to trade lower in the first half backed by some strength in the dollar. However, this complex is likely to take direction from the movement in the dollar depending upon the result of U.S. reports namely Jobless claims and home price index later in the day.
