Find out more at btsub.sg/btdeal
You are here
Gold heads for 2nd weekly drop as investors weigh stimulus cues
[SINGAPORE] Gold headed for a second weekly decline as investors weighed comments from the European Central Bank and the Bank of Japan on the outlook for stimulus measures.
Bullion for immediate delivery traded little changed at US$1,330.74 an ounce at 9:33 am in Singapore, after closing 1.2 per cent higher on Thursday, according to Bloomberg generic pricing.
The metal is down 0.5 per cent this week, with equity market gains weighing on the metal as investors return to riskier assets.
Gold has pared this year's rally as Asian stocks reached an eight-month high and the dollar strengthened. Prospects for stimulus dimmed after BOJ Governor Haruhiko Kuroda dismissed the use of so-called helicopter money to kick-start growth.
ECB president Mario Draghi signaled on Thursday that the bank will only move once it has a clearer picture of the economic impact from the UK vote to leave the European Union. The Federal Reserve's next policy-setting meeting is on July 26-27.
"Gold is definitely in consolidation phase, with a stronger dollar and rising equity markets curtailing demand for the yellow metal," Jordan Eliseo, Sydney-based chief economist at trader Australian Bullion Co, said by e-mail.
"That said, we expect the ECB to add fresh stimulus soon, whilst all eyes will be on the Fed's monetary policy statement due out next week, which we expect will be suitably cautious. Short-term we're neutral on the metal, though we think this is a 'buy the dip' opportunity for long-term investors."