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Gold edges higher ahead of central banks; Gains capped by equities

Published 03/06/2013, 03:23 AM
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Investing.com - Gold futures edged modestly higher in rangebound trade during European hours on Wednesday, as expectations for fresh easing measures by world central banks supported the precious metal.

Gold’s gains were limited as soaring equities in the U.S. dimmed the investment appeal of the precious metal.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,576.30 a troy ounce during European morning trade, up 0.15% on the day.

Prices held in a tight USD5-trading range between USD1,574.40 a troy ounce, the daily low and a session high of USD1,579.50 a troy ounce.

Gold prices were likely to find near-term support at USD1,564.20 a troy ounce, the low from March 1 and resistance at USD1,602.20, the high from February 28.

Market sentiment was supported by prospects for ongoing monetary easing by the Federal Reserve and the Bank of Japan.

Gold traders were also eyeing policy meetings by the European Central Bank and the Bank of England on Thursday, as well as Friday’s closely-watched data on U.S. nonfarm payrolls.

Later in the day, the euro zone was to release revised data on fourth quarter growth, while the U.S. was to publish a report on ADP nonfarm payrolls.

Gains were limited as market players opted for global equities over the precious metal in a risk-on trading session amid hopes the economic recovery in the U.S. is gaining momentum.

The Dow Jones Industrial Average rallied to an all-time high on Tuesday, boosted by stronger-than-expected U.S. service sector data.

Elsewhere on the Comex, silver for May delivery added 0.4% to trade at USD28.72 a troy ounce, while copper for May delivery dipped 0.1% to trade at USD3.511 a pound.

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