Gold advances for the fourth session in a row after successful bond selling by the French and Spanish governments, which showed that the S&P downgrade to a number of euro area economies over the week end did not have a negative impact on investor's behavior, which enhanced demand on commodities and shares. Still, the shiny metal is moving with the market sentiment which is getting direction from the latest developments in the euro area, where the main focus this week was on European auctions and Greek talks with creditors. Today, France sold 7.965 billion euros of medium-term bonds on Thursday, where the yield of the 2014 bills retreated to 1.05% from 1.58% the prior auction, the 2015 notes yields fell to 1.51% compared with 2.44% reached at November's auction and the 2016 securities also showed a drop in borrowing cost to 1.89% from 2.82% at November's auction. Likewise, the Spanish government auctioned 6.61 billion euros of debt maturing in 2016, 2019 and 2022, where the yield on the 10-year securities fell to 5.403% compared with 6.975% at November's auction. Moreover, Greece will resume talks for the second day with private sector debt holders after the halt of the negotiations on January 13, to reach an agreement over the size of losses to be bared by creditors to avert a possible default as early as in March. One finance ministry official said on Wednesday a deal could be reached with creditors by the end of the current week. Regarding fundamentals, data from the U.S. showed that housing starts fell 4.1% in December from the prior 9.3% rise and building permits slipped 0.1% from the revised 5.6% soar. On the other hand, initials jobless claims improved to 352,000 in the week ended Jan. 14 from the revised 402,000 a week before. Spot gold is currently around $1660.30 an ounce, after touching a high $1669.77 while the day's low was recorded at $1655.80. Crude oil is also traded higher near $101.65 a barrel, compared with the day's opening of $101.09. On the otter hand, the dollar index, which tracks the dollar movements versus a basket of major currencies, retreated for the fourth day to hover around 80.20 after opening the day's trading at 80.49. The dollar and gold inverse relationship is becoming stronger as the dollar is not seen as the most favorable safe haven along with the yen.
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