Gold Gains 1 % on Weak US and Chinese Manufacturing Data

NEW YORK (Scrap Monster) : Owing to the weak US and Chinese manufacturing data, precious gold on Thursday saw a marginal increase by 1 % on market. Despite the rise and weak data, the safe haven demand of gold can be depressed due to the recovery of the global economic conditions. According to traders, gold’s safe haven appeal is also affected by the prevailing speculations regarding the stimulus tapering by the US Federal Reserve.

Gold price showed the slight gain mainly after the release of the data that indicated the fall of factory activity in China to a seventh month low. Meantime, a sharp fall was also found in the watched gauge of the US manufacturing sector. At the same time, gold bullion was also found to acquire gain after the losses of the previous session that continued for two days. On the previous session, gold’s inflation hedge appeal was turned down minutes after the latest policy meeting that came from Fed, wherein several policymakers wanted to continue with Fed’s tapering stimulus.

Spot gold increased by 0.9 % at $1,323.31 on Thursday. Gold was also found to rally in tandem with a U.S. equities market, with the S&P 500 index mounting to about 0.7 %. According to traders, the strong inverse link between gold and equities brought signs of weakening lately. U.S. According to preliminary data, COMEX gold futures for April delivery was found at $3.50 at $1,316.90, with trading volume about 20 % below its 30-day average.