Key commodities remained volatile on Monday on uncertainties about a roll-back in the US stimulus measures after a latest data showed a 13.4% drop in the country’s home sales for July. Global gold prices eased in intraday trade after scaling an 11-week peak above the $1,400 an ounce level. Copper hit a four-month high on an expected pick-up in Chinese demand. Brent crude, too, pulled back after hovering around a five-month high on an increased focus on the Syrian conflict and its potential impact on oil supllies from West Asia.
Gold started inching up on Monday on weak US economic data and massive inflows witnessed in the world’s biggest gold-backed exchange traded fund, hitting $1,406.01 an ounce, its highest since June 7. However, the bullion eased from the level as the technical rally lost momentum and spot gold dropped 0.2% to $1,395.85 an ounce by 0941 GMT. US December gold futures rose 10 cents to $1,395.90 an ounce.
The precious metal had gained 1.6% on Friday after the release of weak US house sales data, which could potentially reduce the case for the Federal Reserve to curtail bullion-friendly economic stimulus which was expected to start from September. The SPDR Gold Trust said its holdings rose 6.61 tonnes to 920.13 tonne on Friday, the largest one-day inflow since October 8.
Copper reached its maximum in more than four months in Shanghai on Monday, aided by expectations of a rise in demand from China, the world’s largest refined copper consumer. Last week, data revealed that China’s manufacturing hit a multi-month high, while better-than-expected growth was seen in the euro zone, raising hopes about a global economic recovery, albeit fragile, which could drive demand for raw materials.
December copper contract on the Shanghai Futures Exchange jumped 1.43% to settle at 53,360 yuan ($8,700) a tonne on Monday. Earlier in the session, it hit 53,620, the highest since April 15. The London Metal Exchange was shut for a holiday on Monday.
Brent crude eased towards $110.50 a barrel on Monday after hitting the highest since April 2 on apprehensions that a suspected chemical weapons