BLBG:Gold Advances for a Fourth Day on Stimulus Speculation
Gold may climb for a fourth day in London on speculation central banks in the U.S. and China may take more steps to spur growth after data missed estimates, boosting demand for precious metals.
China reported an unexpected trade surplus last month as import growth trailed forecasts, raising concern the world’s second-largest economy faces a deeper slowdown. The data shows the global environment remains “grim,” said Zheng Yuesheng, head of the customs bureau’s statistics department. Federal Reserve Chairman Ben S. Bernanke said yesterday that the U.S. economy is still “far from having fully recovered.”
“Gold appears to have risen on safe-haven buying due to concern about global economic growth after China’s import growth missed forecasts,” said Mark O’Byrne, the executive director of Dublin-based brokerage GoldCore Ltd. “The poor U.S. jobs number has also led to an increased expectation of further monetary easing from the Federal Reserve.”
Gold for immediate delivery gained 0.4 percent to $1,646.43 an ounce by 9:43 a.m. in London after rising earlier to $1,654.90 an ounce, the highest level in a week. June-delivery gold rose 0.2 percent to $1,647.30 an ounce on the Comex in New York.
Bullion is set for the longest run of gains since the four days to Feb. 23. Holdings in gold-backed exchange-traded products were 2,397.577 metric tons as of yesterday, within 0.6 percent of a March 13 record.
China’s trade surplus was $5.35 billion, compared with a median projection in a Bloomberg survey for a $3.15 billion deficit. U.S. nonfarm payrolls rose 120,000 last month compared with an economists’ forecast for 205,000, according to data on April 6.
Rebound Cap
A rebound in the gold price is likely to be “capped” by its 200-day moving average at about $1,695 and the 50-day moving average at about $1,702, Karen Jones, an analyst at Commerzbank AG, wrote in a report today.
“For gold to turn a corner and build momentum, physical buying really needs to kick in,” Edel Tully, an analyst at UBS AG, wrote in a report.
Spot silver rose as much as 1.3 percent to $31.945 an ounce, rebounding from a 1 percent decline yesterday. It was last up 0.3 percent at $31.6325. Platinum for immediate delivery was little changed at $1,612.50 an ounce. Palladium gained 0.7 percent to $648.25 an ounce.
To contact the reporters on this story: Maria Kolesnikova in London at mkolesnikova@bloomberg.net; Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
