1. Gold inches down as dollar firms, but set for weekly gain

Gold inches down as dollar firms, but set for weekly gain

Gold edged down on Friday as the dollar firmed, but stayed on track for its first weekly gain in four weeks.

By: | Published: October 21, 2016 9:25 AM
Spot gold was down 0.1 percent at ,264.40 an ounce at 0024 GMT, after dropping 0.2 percent the session before. It was set to end the week up over 1 percent. (Reuters) Spot gold was down 0.1 percent at ,264.40 an ounce at 0024 GMT, after dropping 0.2 percent the session before. It was set to end the week up over 1 percent. (Reuters)

Gold edged down on Friday as the dollar firmed, but stayed on track for its first weekly gain in four weeks.

FUNDAMENTALS

* Spot gold was down 0.1 percent at $1,264.40 an ounce at 0024 GMT, after dropping 0.2 percent the session before. It was set to end the week up over 1 percent.

* U.S. gold futures fell 0.2 percent to $1,265.50.

* The European Central Bank on Thursday left interest rates unchanged, maintaining the parameters of its 1.74 trillion euro ($1.95 trillion) asset buying scheme.

* Ultra-low rates tend to support gold, though that is often offset by the impact of a weaker euro. The single currency fell to a four-month low against the dollar on Thursday.

* The dollar index, which measures the greenback against a basket of currencies, was up 0.1 percent at 98.374. It rose to a seven-month high on Thursday.

* U.S. home resales surged in September after two straight months of declines as first-time buyers stepped into the market, pointing to underlying momentum in the economy.

* While other data on Thursday showed a bigger-than-expected increase in the number of Americans filing for unemployment benefits last week, the trend continued to suggest that the labour market remains strong. Labour market strength is one of the key factors underpinning the housing market.

* Traders are closely watching U.S. data for clues about when the U.S. Federal Reserve will raise interest rates, heavily tipped by a number of Fed policymakers for December.

* Gold is highly sensitive to rising rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.

* Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.31 percent to 970.18 tonnes on Thursday.

* India’s overseas purchases of gold likely hit a nine-month high in October, as a flip in domestic prices to a premium prompted banks and refiners to resume imports ahead of the festival season, industry officials told Reuters.

* Russia’s gold reserves totalled 49.6 million troy ounces as of Oct. 1, up from 49.1 million ounces a month earlier, the central bank said on Thursday.

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