The spot gold price drifted during Asian trading hours on Friday supported by safe haven buying but capped by a stronger US dollar.
Spot gold was last at $1,322.35-1,322.75 per ounce, up just $0.55 from Thursday’s close. Trading ranged at $1,321.05-1,324.80 so far.
“Further ongoing uncertainty surrounding the US presidential elections and more recently, the Deutsche Bank issue, should province an underlying bid for the metal,” MKS Group said on Friday morning.
Some Deutsche Bank clients, among them several big hedge funds, have withdrawn securities or cash from the German lender amid concerns about its stability and their exposure, the Wall Street Journal reported on Thursday.
Safe haven asset buying was heightened in global markets due to anxiety over Deutsche Bank’s finances, ANZ Research said Friday morning.
In currencies, the US dollar index rose 0.1 percent to 95.61 so far on Friday.
“Since bottoming out in May, the dollar index has been in its ascendancy. Despite a slowdown in this resurgence, we have not yet seen anything to say this rally is over,” Joshua Mahoney, a market analyst at IG.
“As long as we do not see an hourly close below 94.11, there is reason to believe the dollar will continue to perform over the coming months,” he said.
In data, China’s Caixin manufacturing PMI for September came in 50.1, within expectations and close to August’s reading of 50.0. An above 50 reading signifies expansion, and below, contraction.
Having stagnated in August, Chinese manufacturers signalled little-change to overall operating conditions during September, Caixin Insight Group said.
On a positive note, output and total new orders continued to expand, albeit marginally, while firms raised their purchasing activity for the third month in a row, it added.
“The readings for the manufacturing PMI over the past three months seem to indicate that the economy has begun to stabilise, Zhong Zhengsheng, director of macroeconomic analysts at CEBM Group, said.
“But given that the growth rate of fiscal income has slowed recently while expenditures have swung, there is insufficient momentum to drive future economic growth, and there is a risk that industrial output may decline,” he cautioned.
On Saturday, China will release its official manufacturing PMI and non-manufacturing PMI for September. A figure of 50.5, close to August’s 50.4, is called for.
The official PMI is more focused on large state-owned firms, while the independently surveyed Caixin PMI is closely watched for conditions among the country’s private sector.
In other commodities, crude oil prices remained supported by the initial production cut deal agreed among OPEC producers in Algiers, Algeria on Wednesday. The deal could possibly be formalised in November.
The Brent crude oil spot price hit another fresh three-week high of $49.80 per barrel on Friday – it was last at $49.41, down 0.37 percent from Thursday’s close. The Texas light sweet crude oil spot price was recently at $47.53, down 0.48 percent on Friday after touching a five-week high of $48.28 a day ago.
In US data released on Thursday, second quarter final GDP growth came in at 1.4 percent quarter-on-quarter, slightly better than expectations of 1.3 percent. Weekly unemployment claims for last week was also better than expected at 254,000, against a forecast of 260,000.
Pending home sales for August, however, fell 2.4 percent month-on-month – a 0.1 percent decline was called for.
Other US data due later on Friday includes the Core PCE price index, personal spending, personal income, Chicago PMI, revised UoM consumer sentiment and revised UoM inflation expectations.
In equities, the Shanghai Composite rose 0.14 percent to 3,002.81 recently on Friday.
In other precious metals, silver was last at $19.08/19.10, down $0.025. Platinum rose $2 to $1,024/1,031, and palladium increased $2 to $713/721 recently on Friday.
On the Shanghai Futures Exchange, gold for December delivery was last unchanged at 287.50 yuan per gram, and the December silver was flat at 4,275 yuan per kilogram.
The post Gold supported by safe haven buying but capped by stronger US dollar appeared first on The Bullion Desk.
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Source: Bullion Desk News
