Gold rallies to score first weekly gain amid growth fears

Gold rallies to score first weekly gain amid growth fears

Mubasher: Gold prices punched higher on Friday as investor appetite for the safe-haven metal were revivified by signs of soft global growth, keeping it on course to record its first weekly gain in five, Reuters reported.

By 7:59 am GMT, spot gold rose 0.36% to $1,281.75 per ounce, while US gold futures went up 0.34% to $1,284.10 per ounce.

Spot gold is en route to see its first win since the week ended 22 March.

Asian equities retreated after stocks worldwide were dragged down by disappointing economic figures from Germany and Asia, indicating that the global economy is not still out of the woods.

“Weak data indicates that the countries may have to undertake monetary easing measures, so that is a boost to gold prices,” Argonaut Securities analyst Helen Lau was quoted by Reuters.

Major central banks all over the globe were no longer tending to tighten their monetary policy as the global economic growth outlook turned gloomier across developed and emerging economies, as well as meagre suggestions of a surge in inflation.

What added further evidence to that were a recent downgrade of global growth forecast by the Bank of Canada (BoC) and a move by the Bank of Japan (BoJ) to maintain interest rates at their ultra-low levels for at least one more year.

Meanwhile, the US dollar stood near a two-year high on signs that the world’s biggest economy was growing better than others. This was amplified by a growth of new orders for the US-made capital goods by the most in eight months in March.

At 8:01 am GMT, the US dollar index, which traces the greenback against six key peers, ticked down 0.07% to 98.1340.

In the same vein, market participants will be now awaiting the release of US gross domestic product (GDP) for the first quarter of this year due later in the day.