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Gold futures rise ahead of ECB, BoE; Non-farm payrolls in focus

Published 03/07/2013, 03:27 AM
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Investing.com - Gold futures were higher during European morning hours on Thursday, as investors looked ahead to policy meetings by the European Central Bank and the Bank of England later in the day.

Market players also awaited the release of key U.S. monthly jobs report on Friday as well as Chinese economic numbers due out Friday and Saturday.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,583.40 a troy ounce during European morning trade, up 0.55% on the day.

Prices rose by as much as 0.6% earlier in the day to hit a session high of USD1,584.80 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.

The ECB was widely expected to leave rates on hold at 0.75%, but concerns over the economic outlook for the region fuelled speculation over the prospect of future rate cuts.

Meanwhile, the pound fell to a two-and-a-half year low against the U.S. dollar ahead of the BoE’s policy meeting later Thursday, amid speculation over whether the central bank will resume its asset purchase program.

In a busy day for central banks, the Bank of Japan announced no changes to monetary policy at the conclusion of its policy meeting earlier in the day, but expectations for more aggressive easing measures in the future remained intact.

Gold traders are also focusing on the U.S. nonfarm payrolls employment report due Friday. On the same day, China will announce its trade data for February, which will be followed by inflation and industrial numbers over the weekend.

Weakness in the U.S. dollar contributed to gains. The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was down 0.15% to trade at 82.44.

Gold’s investment appeal has weakened in recent weeks as market players opted for global equities over the precious metal, amid hopes the economic recovery in the U.S. is gaining momentum.

The Dow Jones Industrial Average moved further into unchartered territory Wednesday after data showed that private sector employment increased more-than-expected in February.

Elsewhere on the Comex, silver for May delivery added 0.6% to trade at USD28.96 a troy ounce, while copper for May delivery tacked on 0.3% to trade at USD3.504 a pound.

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