Gold prices are increasing amidst the speculation that the Federal Reserve will maintain stimulus. The Fed officials are holding a meeting today and any decision they will reach will come out tomorrow; however, the speculation that they will be continuing the stimulus for the U.S. economy is far from a recovery, is sending gold prices to even higher levels.
Gold Prices Increase to the Highest Level in Five Weeks
Reportedly, gold prices have gone up and reached the highest level in five weeks where bullion immediate delivery has gained as much as 0.6 percent to $1,360.76 an ounce. Gold futures for December delivery edged up 0.16% on Friday and settled for the week at USD1, 352.50 a troy ounce on the Comex division of NYME (the New York Mercantile Exchange).
The current gold prices are indicating that the trend may not diminish soon. In the last week the December contract rallied 1.22% on Thursday and settled at USD1,350.30 a troy ounce; however, on Monday it was $1,360.76 an ounce. The resistant point for the gold prices is set around the $1366 level.
Yesterday was a better trading day for gold as prices touched $1,361.93 which is the highest since Sept. 20. Even holdings in the SPDR Gold Trust, the biggest bullion-backed exchange-traded products were trading steady at 872.02 metric tons. Whereas gold advanced in October as U.S. lawmakers wrangled over the nation’s budget and debt ceiling, silver is expected to follow the trend i.e. spot silver traded at $22.5295 an ounce from $22.5043 yesterday.
According to some market observers the rise in gold prices is due to official data that was released last Friday showed that core durable goods orders declined for the third consecutive month in September. In such circumstances, trust in gold increases to a great extent. Amidst the concerns over the stimulus from the Fed in U.S. gold for delivery in December climbed 0.3 percent to $1,356 on the Comex in New York.
Thus, gold has been heading northwards for the third month as the trading volume was 13 percent below the average for the past 100 days for this time of day. The demand for gold jewelry and coins will gain momentum in India as the festive season has just began and people are going for a shopping spree; however, increased gold prices may deter them.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org