adminMANILA. – Gold edged to a three-month high yesterday as weak global manufacturing activity underscored the challenges for the world economy, pushing investors towards safe-haven assets. Increased volatility in other assets has benefited gold and it could see more gains as global central banks may be forced into easing monetary policy further this year to spur growth.
With rates close to zero, the “only option is to move either towards zero or negative rates as the Japanese and selected European countries are already doing in a desperate attempt to force banks to lend”, INTL FCStone analyst Edward Meir wrote to clients.
“Whatever the case, this should be constructive for gold.”
Spot gold touched $1 130,11 per ounce, its strongest since November 3, and was trading down 0,2 percent at $1 126,55 by 2.26am GMT. A break above $1 136 could lift gold towards $1 157, a level reached in late October, said ScotiaMocatta technical analysts.
US gold for April delivery was flat at $1 127,30 per ounce. Reflecting growing confidence in gold, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose to 21.9-million ounces on Monday, the most since November 3. Global manufacturing expansion accelerated slightly but remained weak at the start of 2016 as faster growth in developed markets failed to offset a contraction in emerging economies. – Reuters.
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