The preliminary reading of Caixin’s Purchasing Manager’s Index came in at 47.1 this month for China, the worst print since that of 44.8 in March 2009, according to the data by Markit, a financial information services provider that compiled the survey. Meantime the US crude oil contracts fell to a 6-year low, just shy of $41 per barrel in what an analyst called a “bloodbath”. The DAX has already shed more than 5% this week alone and is trading at its lowest level since January, so it is no surprise that investors are rediscovering gold as a safe haven, says Commerzbank. Apart from the fears of a deep Chinese slowdown, a coninuing glut in the global market weighed on oil prices. The recently signed deal on Iran’s nuclear program loosened sanctions on that country’s oil shipments, which will help keep prices low, Orengo said.
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Those who began singing the swan song for gold around four weeks ago are doubtless rubbing their eyes in amazement now, for gold has meanwhile gained by almost $100 as compared with its end of July 5½-year low. It has lost roughly 20% this year. Gold was given support as traders speculated on the information contained in the release of the meeting minutes from the last Federal Open Market Committee. Spot gold hit a peak of $1,168.40 an ounce and was at $1,153.60 at 1414 GMT, little changed from late on Thursday and up 3.5 percent on the week. Spot gold is still up over 3% this week.
In the national capital, price for 24 carat gold was hovering around Rs.27,300 per 10 grams and price for 22 carat was around Rs.26,900 per 10 grams.
The precious metal with purity levels of 99.9% and 99.5% surged by R480 each to R27,180 and R27,030, respectively, on Friday – the highest since June 19.
“The massive move we have experienced during the past couple of days… was primarily on the back of dollar softness and qualms around emerging markets”, said Naeem Aslam, chief market analyst at Ava Trade.
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The world’s largest gold-backed exchange-traded fund, New York’s SPDR Gold Shares, reported an inflow of 3.6 tonnes on Thursday, its first more than a week.
