Gold tested highs above $1540 per ounce levels today, hitting their two and half week highs as Euro surged above 1.4400 against the dollar on hopes that the Greece situation would not turn murkier in near term. The Eurozone debt troubles were seen easing on reports that Germany may drop its call for Greece to restructure its debt, giving the beleaguered nation a hope that it will get a new tranche of aid to help it avoid a default. Euro gained on these reports, supporting risky assets across the board
On the economic front as well, there was a couple of supportive data points for the single currency. German April retail sales increased 0.6% in April in price-adjusted terms compared to the month before, after dropping 2.7% in March, according to latest data out from Germany's Federal Statistics office. Eurozone inflation eased to 2.7% in May from April's 30-month high of 2.8%, according to latest flash estimates from the Eurostat. The annual rate suggests a negligible monthly decline in consumer prices.
Gold has been in a good touch after managing to hold on above $1500 and most of the market men are expecting the yellow metal to test highs of $1550 if the current conditions persist. The metal advanced to a high of $1541 per ounce today and currently quotes at $1435.90, down 40 cents on the day. MCX Gold futures for August are quoting at Rs. 22710, down Rs. 34 on the day. Prices are likely to be in for a range bound time in the evening trades. A clear break above Rs. 22800 would be needed to confirm further upside for the counter.
