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Kitco April 29, 2016 02:01:42 AM

Gold Solidly Higher On Safe-Haven Demand, Technical

Paul Ploumis
ScrapMonster Author
Gold prices were ending the U.S. day session with solid gains and near the daily high early Thursday afternoon.

Gold Solidly Higher On Safe-Haven Demand, Technical

(Kitco News) - Gold prices were ending the U.S. day session with solid gains and near the daily high early Thursday afternoon. The yellow metal was supported on safe-haven demand as world markets were unsettled by Japan’s central bank surprisingly taking no action at its monetary policy meeting. Gold and silver bulls are also having a good week from a technical perspective, which has invited fresh chart-based buying in both metals. June Comex gold was last up $17.00 at $1,267.40 an ounce. July Comex silver was last up $0.265 at $17.60 an ounce.

The Bank of Japan left its monetary policy unchanged at its meeting Thursday. Most of the marketplace was surprised, as most looked for additional stimulus measures to be unveiled. The Japanese yen rallied and Japanese stocks sold off sharply in the wake of the BOJ meeting. The BOJ inaction came despite a report released Thursday that showed consumer price inflation in Japan down 0.3% in March, year-on-year. The BOJ is battling slow economic growth, price deflation and an appreciating yen on the world foreign exchange market.

The precious metals markets were also supported by a downbeat U.S. economic report Thursday. The first-quarter advance GDP report came in at up a paltry 0.5%, year-on-year, which was below expectations. This downbeat, important economic data led many market watchers to believe that June is now “off the table” for a Federal Reserve interest rate hike.

World stock markets were mostly lower overnight, in part spooked by the lack of BOJ action on its monetary policy. U.S. stock indexes were mixed in afternoon trading in New York.

Nymex crude oil prices were firmer Thursday and hit another nearly five-month high, trading above $45.00 a barrel. The other key “outside market” saw the U.S. dollar index lower and near the multi-month low scored in mid-April. The weaker greenback recently has been a bullish underlying factor for the precious metals and for the entire raw commodity sector.

Courtesy: Kitco News

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