Gold futures ended on a quiet note in the native market on yesterday but advanced in the overseas market as downbeat United States housing & manufacturing data signaled a cooling recovery in the world’s largest economy, raising question marks over the pace of impending policy tightening by the US Fed Reserve.
While a Chicago Business Index went down into contraction in Nov, US pending home sales climbed less than forecast in October month following declines over the previous 2 months, raising concerns over the economy’s ability to withstand sustained pace of policy tightening.
While the Fed is most likely to increase borrowing costs for the first time in almost a decade, in Dec month, it may go easy on subsequent rate hikes, with the pace of tightening likely to be gradual, bolstering gold’s appeal as a store of value.
Caution ahead of key economic events this week including the United States jobs data & the European Central Bank (ECB) policy meet kept traders on the sidelines.
A strengthening USD has also decreased the appeal of the bullion as an alternative asset. Stronger greenback makes gold more costly for those holding other currencies, thus dimming requirement.
While a Chicago Business Index went down into contraction in Nov, US pending home sales climbed less than forecast in October month following declines over the previous 2 months, raising concerns over the economy’s ability to withstand sustained pace of policy tightening.
While the Fed is most likely to increase borrowing costs for the first time in almost a decade, in Dec month, it may go easy on subsequent rate hikes, with the pace of tightening likely to be gradual, bolstering gold’s appeal as a store of value.
Caution ahead of key economic events this week including the United States jobs data & the European Central Bank (ECB) policy meet kept traders on the sidelines.
A strengthening USD has also decreased the appeal of the bullion as an alternative asset. Stronger greenback makes gold more costly for those holding other currencies, thus dimming requirement.
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