You are here
Gold advances on interest rate bets before ECB's debt decision
[MELBOURNE] Gold climbed as investors assessed the outlook for interest rates before the European Central Bank announces details of its debt-purchase program.
Bullion for immediate delivery advanced as much as 0.5 per cent to US$1,206.03 an ounce and was at US$1,204.14 by 1:49 pm in Singapore, according to Bloomberg generic pricing. The precious metal is down 0.8 per cent this week and fell to US$1,195.50 on March 3, the lowest since Feb 24.
Investors are assessing data for clues on when the Federal Reserve may raise benchmark rates from near zero. A purchasing managers index on services in the US unexpectedly expanded at a faster pace in February, a report showed Wednesday when US stocks fell for a second day. The ECB will leave its benchmark interest rate at a record low of 0.05 per cent and the deposit rate at minus 0.2 per cent when it meets in Nicosia, Cyprus, according to all economists surveyed by Bloomberg News.
"The market is trying to second guess when rates are going to go up," said David Lennox, a resource analyst at Fat Prophets in Sydney. While "strong PMI numbers should have given it a downside, the weak US equity market should give it an upside," he said by phone.
Gold for April delivery increased 0.2 per cent to US$1,203.50 an ounce on the Comex.
Silver for immediate delivery was little changed at US$16.2554 an ounce. Spot palladium rose 0.5 per cent to US$831.50 an ounce and platinum climbed 0.4 per cent to US$1,186.75 an ounce.