“BUY GOLD ABOVE 27850 TGT 27950/28100”
Gold: Gold rose to a three-month high in volatile
trade on Friday, as a mixed U.S. jobs report prompted investors to reassess the
outlook for U.S. interest rates this year, putting bullion on track for its
strongest weekly performance in more than a year. U.S. employment gains slowed
more than expected in January as the boost to hiring from unseasonably mild
weather faded, but rising wages and an unemployment rate at an eight-year low
suggested the labor market recovery remains firm. As a non-interest bearing
asset, dollar-denominated gold becomes less attractive if U.S. interest rates
rise.
A shaky global economy has lifted buying interest in gold, making it
among the best performing assets since the start of 2016 with a gain of nearly
10 percent. Holdings of SPDR Gold Trust, the world's largest gold-backed
exchange traded fund, rose to 22.3 million ounces on Thursday, the highest
since late October. Other precious metals were unable to turn around from
earlier weakness, having fallen from multi-month highs. Outlook: We expect gold prices to trade positive on the back of weak economic data from the US.
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