OIL: Benchmark U.S. crude oil gained 27 cents to $49.96 per barrel in electronic trading on New York Mercantile Exchange.
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BENGALURU – Gold touched a fresh two-week high on Wednesday as the possibility of an early USA interest rate hike appeared to dim following dovish comments by Federal Reserve chairwoman Janet Yellen earlier this week.
In Asia, Hong Kong (.HSI) led regional stock markets, rising 1 percent as investors hunted for bargains in one of the cheapest equity markets in the region.
The dollar was flat at 107.315 yen JPY= off the one-month low of 106.35 touched on Monday but still a long way away from the recent peak of 111.455 scaled at the end of May.
Spot gold was down 0.3 per cent at US$1,240.71 an ounce at 0934 GMT, while U.S. gold futures for June delivery were down US$3.90 an ounce at US$1,243.50.
However, a report in the Exchange Rates said, despite the setback, the U.S. currency is projected to strengthen to $1.10 per euro and 115 yen by the end of the year, according to surveys of analysts by Bloomberg. “There are no major USA indicators until the Fed’s policy meeting next week, and the dollar is likely to remain bearish until then”, said Junichi Ishikawa, forex analyst at IG Securities in Tokyo. Fed boss Yellen expressed confidence in the world’s top economy on Monday, but also signalled caution about raising rates following last week’s dismal USA jobs report-calling it “concerning”.
Gold eased on Tuesday as investors turned cautious after the metal failed to sustain a recent rally, though it held near the previous day’s two-week high after the Federal Reserve further dampened speculation about an imminent US rate rise.
Her failure to mention the specific timing on interest rates hikes was seen by economists to signal that a rise was unlikely at the policy meeting next week, particularly after a much worse-than-expected United States non-farm payrolls report on Friday.
The Nasdaq Composite added 26.20 points, or 0.53 percent, to 4,968.71.
The pound strengthened after the U.K. Office for National Statistics earlier said that industrial production rose 2.0% in April after a 0.3% increase in March, the largest monthly increase since July 2012. The dollar index .DXY was last down 0.02 percent at 93.887.
“Her comments point towards the world remaining stuck in a low-growth and low-yield environment which should be positive for risky assets and keep the dollar soft”, she said. Brent crude, which is used to price global oils, lost 18 cents to $50.37 a barrel in London.
Dow e-minis were up 45 points, or 0.25 percent at 8:15 a.m. ET, with 18,048 contracts changing hands.
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US gold climbed 1.4 percent to $1,261.60.
