12 March 2015
Gold Rebounds From 3-Month Low as Investors Weigh Rate Outlook
(Bloomberg) - Gold snapped an eight-day run of losses that was the longest since 2009 as the dollar weakened from a decade-high, boosting demand for the metal. Silver, platinum and palladium climbed.
Bullion for immediate delivery rose as much as 1 percent to $1,166.66 an ounce, and traded at $1,163.35 at 3:51 p.m. in Singapore, according to Bloomberg generic pricing. Prices lost 4.8 percent in the eight days to Wednesday, when bullion sank to $1,147.72, the lowest since Dec. 1 as the U.S. currency climbed. Earlier on Thursday, gold was as much as 0.4 percent lower.
The Bloomberg Dollar Spot Index retreated 0.4 percent on Thursday after climbing for six days on speculation that the Federal Reserve is getting closer to raising rates as the largest economy recovers. Some investors may now be weighing whether central bankers are so concerned the rising currency will hurt U.S. corporate profits, that they will delay the rate-rise scenario, according to Wayne Gordon, an analyst at UBS Group AG in Singapore. The rate-setting Federal Open Market Committee is scheduled to meet next week.
“All people are really doing is hedging their bets a little bit, so the dollar comes off, gold goes up and rate expectations get kicked down the road a little bit,” Singapore-based Gordon said by phone.
On Wednesday, spot gold’s 14-day relative strength index held below the level of 30 for a fourth day, indicating to some investors who study charts that prices may be poised to rebound. The gauge was at 30.2 on Thursday.
Bullion for April delivery climbed 1 percent to $1,162 on the Comex in New York.
Silver for immediate delivery surged 0.9 percent to $15.645 an ounce after dropping on Wednesday to $15.2977, the lowest level since Dec. 1. Spot platinum jumped 0.7 percent to $1,128.50 an ounce after reaching $1,114.05 on Wednesday, the lowest price since 2009. Palladium increased 0.8 percent to $795.30 an ounce.