“However, now we do need a new catalyst to drive the price any higher and next week’s economic data could certainly fulfil this craving”. A reading below 50 suggests contraction. Growing expectations a US rate hike would be delayed to December after a soft run of data also supported gold, he added.
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“We´ve definitely seen a bit of a safe-haven bid return for gold”, said analyst Daniel Hynes of ANZ in Sydney.
Past 1631 BST on Friday, the Brent front month futures contract was down 2.79% or $1.30 to $45.32 per barrel, while the WTI was down 2.59% or $1.07 to $40.25 with Chinese data weighing on sentiment. While crude oil slumped heavily over the last 20 days, the opposite has happened with gold.
Prices of the precious metal started rising in the wake of China’s decision to devalue the yuan last week, causing turbulence across equity and currency markets. Spot platinum was down 0.6 per cent at $US1,024.41 an ounce, trading above the psychologically important $US1,000 level for the second day in a row. The metal had crashed to a six-year low of $4,976 a tonne earlier this week, having recorded a decline each week since early July. The greenback and gold usually share an inverse relation.
Spot gold hit a peak of $1,168.40 an ounce and was at $1,153.42 at 1200 GMT, little changed from late Thursday and up 3.5 percent on the 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. Although euro-zone PMIs improved from month-ago levels, the selloff was already underway, with EU bourses sinking almost 3% or more today in sympathy with the Wall Street retreat.
In energy trading, oil futures settled lower on Friday, down 4.8% on the week, weighed on by a weekly rise in the number of active U.S. oil rigs and worries about a slowdown in energy demand spurred by losses in Chinese and U.S. stock markets.
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“We think there are three drivers that are in the market right now: the Fed, China – and I’ll also couple in other emerging market currencies with China in terms of currency devaluation – and short covering”, Alderman began.
