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  1. Gold firms near $1,110 but poised for third weekly drop

Gold firms near $1,110 but poised for third weekly drop

Earlier in the week, gold had fallen to $1,101.11, the lowest since August 11. It has lost 1 percent for the week.

By: | Singapore | Published: September 11, 2015 9:23 AM
Gold rate

Earlier in the week, gold had fallen to ,101.11, the lowest since August 11. It has lost 1 percent for the week. (Express Photo)

Gold clung to small overnight gains near $1,110 an ounce on Friday, but the metal was headed for a third consecutive weekly fall as investors continued to fret over the timing of a looming US interest rate hike.

FUNDAMENTALS

Spot gold was little changed at $1,111 an ounce by 0025 GMT, after gaining 0.5 percent in the previous session.

Earlier in the week, gold had fallen to $1,101.11, the lowest since August 11. It has lost 1 percent for the week.

US gold, also headed for a third weekly dip, was trading at $1,110.40.

Traders were awaiting the Federal Reserve’s next policy statement on Sept. 17 for clues on the timing of a US interest rate rise, before taking any big positions in gold.

Concerns over slowing growth in China, mixed economic data and volatility in financial markets have increased uncertainty about the timing of a US rate increase, which had been expected as early as this month.

Data on Thursday showed the US labour market appeared to gain momentum in early September as fewer Americans filed for weekly unemployment benefits, but weak inflation pressures may complicate the Fed’s decision whether to raise interest rates.

Bullion has benefited in recent years from ultra-low rates, which cut the opportunity cost of holding bullion while holding the dollar in check. But expectations that rates will rise soon have pushed the metal down 6 percent this year.

BNP Paribas SA revised its gold price forecast for 2015 on Thursday, citing strength in the US dollar and concerns over the Chinese economy. The bank cut its price forecast by $15 to $1,145 per ounce in 2015.

The London Metal Exchange is in talks with the gold industry with a view to launching precious metals derivatives, LME Chief Executive Garry Jones said on Thursday.

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