Gold hits 3-1/2 month high on favourable US data

Gold hit three–and-a-half-month high in the international market today on renewed investors’ confidence as safe haven avenue after favourable US economic data that trailed earlier estimates.

Gold surpassed $1,300 an oz to hit $1,319 an oz in the afternoon trade on Friday but, soon fell marginally from this level on profit booking.

Similar trend was witnessed in India as well. Gold shot up by 1.46% or Rs 440 to close on Friday at Rs 30550 per 10 gms, a level not seen after December 14, 2013. Silver followed suit to gain 3.53% or Rs 1,600 to close on Friday at Rs 46950 a kg.

In a positive note, US retail sales fell in January by the most since June 2012, while jobless claims unexpectedly climbed last week. Stimulus will be cut in measured steps, Fed Chairman Janet Yellen said, while reiterating that the purchases aren’t on a preset course.

“Fed chairman’s statement was the biggest factor supported inflows in gold for the price to take upwards. The next technical level we see between $1310 and $1335 an oz,” said Gnanasekar Thiagarajan, Director, Commtrendz Research.

Investors’ sentiment was robust in the exchange traded fund (ETF) also. Assets in the SPDR Gold Trust expanded 1.2% to 806.

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