Gold price recovers from three-week low on disappointing Chinese trade report
The price of gold has rallied so far in today’s trading following last week’s selloff that saw bullion hit a three-week low during Friday’s session on speculation over a hike in US interest rates. The precious metal rose following disappointing Chinese economic data and amid news of renewed tensions across Europe.
Gold for immediate delivery had gained $8.64 or 0.7 percent, to $1,241.42 as of 09:28 GMT, and was trading over one percent above its 50-day simple moving average of $1,228.67. The precious metal has recovered some of its losses following a 1.8 percent slump during the previous session. The rebound was stirred by a disappointing Chinese trade report released over the weekend which raised concerns about a deepening slowdown in the world’s second-largest economy, boosting demand for precious metals. According to the report, Chinese exports declined 3.3 percent year-on-year while imports tumbled 19.9 percent.
The precious metal touched $1,228.17 on Friday, the lowest since 15 January, after strong US jobs data boosted expectations of a rise in interest rates. The number of non-farm jobs created in January came in at 257,000, ahead of the forecasts for 230,000 reported by IG, the US Bureau of Labor Statistics reported.
On the COMEX in New York, gold for April delivery had gained four dollars, or 0.32 percent, to be at $1,239.9 as of 09:02 GMT. Bullion advanced as Greek Prime Minister Alexis Tsipras reaffirmed his government’s intent to fight the country’s bailout terms and amid worries over a renewed escalation in the Ukrainian conflict, spurring demand for haven assets. Bloomberg quoted David Lennox, a resource analyst at Fat Prophets in Sydney, as saying:
“It looks Ukraine is going to deteriorate, with both sides threatening to up the ante it would probably give it a little bit of a safe-haven shake”. According to him, the deadlock in Greece “adds to the same safe-haven story”.