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| Commodity News |
| HeadLine : |
Gold prices dip in Asia as China moves to stoke growth |
| Date : |
Oct 20 2014 |
Gold prices fell in Asia early Monday as China moved to prime growth and investors see more likelihood the U.S. Federal Reserve will move to hike rates early next year.
Gold prices dip in Asia as China moves to stoke growthGold weaker in Asia
On the Comex division of the New York Mercantile Exchange, gold for December delivery traded at $1,236.30 a troy ounce, down 0.22%, after settling at a troy ounce by close of trade last week.
U.S. and European stock markets rallied on Friday, following steep losses and massive intraday swings over the past five days, sparked by concerns about global economic weakness and fears over the spread of Ebola.
The S&P 500, Dow 30 and the tech-heavy NASDAQ Composite all gained more than 1% on Friday, while Germany's DAX surged more than 3%.
Gold and stocks tend to move in opposite directions.
Meanwhile, investors continued to speculate over the timing of a rate hike in the U.S. after a report showed that the University of Michigan’s consumer sentiment index unexpectedly rose to 86.4 in October, the most since July 2007.
Another report showed that housing starts rose more than expected last month, bolstering the outlook for the sector.
Gold prices rallied to a five-week high on Wednesday amid speculation weaker than expected global economic growth and its effect on the U.S. economy may lead the Federal Reserve to push back interest-rate increases.
A delay in raising interest rates would be seen as bullish for gold, as it decreases the relative cost of holding on to the metal, which doesn't offer investors any similar guaranteed payout.
Also on the Comex, silver for December delivery shed 0.38% to $17.265 a troy ounce. Copper for December delivery rose 0.29% to $3.014 a pound.
Last week, copper futures turned higher after China's central bank signaled plans to extend as much as 200 billion yuan in short-term loans to the nation's banks in order to spur lending activity and boost growth.
Copper traders are looking ahead to a raft of Chinese economic data later this week, including reports on third quarter gross domestic product, as well as data on industrial production and retail sales.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
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