May 17, 2024 03:56 PM IST
GLOBAL-PRECIOUS/ (UPDATE 3):PRECIOUS-Gold heads for second weekly gain, extending support to silver and platinum
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Gold up 1% so far for the week
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Silver up 5.5% this week, hit three-year peak on Thursday
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Platinum gains 6.6% this week
By Polina Devitt
LONDON, – Gold prices were on track for a second consecutive weekly gain on Friday due to improved interest rate cut expectations, providing support to silver and platinum, which are up 5.5% and 6.6%, respectively, this week.
Spot gold rose 0.3% to $2,384.08 per ounce by 0945 GMT. Bullion prices are up 1% so far this week after hitting a one-month high on Thursday.
“Signs that inflation may be slowing down raise the prospect of interest rate cuts in the coming months, which tend to support gold and silver prices,” said Frank Watson, market analyst at Kinesis Money.
On the demand side, expectations of continuing strong retail demand in China got a boost after the country announced more efforts to stabilise its crisis-hit property sector.
The retail demand in China, which contributed to the gold price rally in recent months, is becoming more crucial as the market is waiting to see if high gold prices prompt some central banks to slow down purchases and as outflows from physically backed gold exchange traded funds continue.
Global central banks actively bought gold in 2022-2023, but the largest purchaser among them, China’s central bank slowed down buying in April when spot gold prices hit a record high of $2,431.29.
“Central banks these days are much more nuanced in their buying behaviour and will alter the programme to be more opportunistic – that is to say buying on dips and scaling back on rallies,” independent analyst Ross Norman said.
On the supply side, the 15% increase in gold price since the start of 2024 keeps margins robust for gold miners. According to the World Gold Council, gold miners’ global average total expenses were at $1,342 per ounce in the last quarter of 2023.
Meanwhile, silver and platinum got support from higher prices for gold and base metals.
Spot silver rose 0.4% to $29.71 per ounce after hitting a more than three-year high and flirting with a major resistance level of $30 in the previous session.
Platinum added 0.2% to $1,059.15, after hitting a one-year high on Thursday. The metal is up 6.6% so far this week due to continued structural deficits.
Palladium dropped 1.3% to $980.91, under pressure from rising market share of electric vehicles.
This article was generated from an automated news agency feed without modifications to text.
