Most analysts claim that the Federal Reserve will keep its stimulus in the coming months. This has helped gold futures advance to the highest level in a month. Earlier, reports were ripe that gold prices would climb higher next week amidst the news that downbeat U.S. labor market data would mean sluggish economic growth where gold finds its buyers as people consider it a safe investment option.
True to the expectations that gold prices are going up; moreover, as U.S. orders to manufacturers unexpectedly dropped in September amidst the news that consumer sentiment has sunk in October to a 10-month low. Even the dollar is not faring better when compared with its peers like the euro where it slid to the lowest level in two years.
Gold Investors are Buoyant about the Prices
According to some investors, as the higher likelihood that the Fed will trim its $85 billion of monthly bond purchases have diminished significantly on growth concerns, investors feel that gold is benefiting to a great extent. Investors are hoping that even though bullion has declined 19 percent this year, they still see a lot of opportunity.
A significant improvement has been in gold futures for December delivery wherein a growth of 0.2 percent has been marked. This has settled gold futures at $1,352.50 an ounce on the Comex in New York. Earlier it touched $1,356.40, the highest since Sept. 20 which led to an addition of 2.9 percent this week i.e. the second straight increase for gold.
On the other hand, silver futures for December delivery dropped 0.8 percent to $22.639 an ounce in New York. Like gold prices, silver prices have been seeing a lot of decrease.
Silver prices are down 25 percent this year to become the second-worst performer on the Standard & Poor’s GSCI index of 24 raw materials.
As Festive Season Begins Gold to Get New Buyers in India
If it is the Fed in the U.S., it is the festive season in India which is playing a vital role in the increase of gold prices. The gold and silver prices climbed as Diwali is on the scene and buyers invest in gold and other precious metals as it is considered a ritual.
Whereas gold prices gained Rs 170 to Rs 32,570 per ten gram, silver was up by Rs 450 to Rs 49,900 per kg on increased offtake by jewelers and industrial units.
To contact the reporter of this story: Jonathan Millet at email@example.com