Gold futures rose in electronic trade Tuesday, with a decline in the U.S. dollar aiding the precious metal’s price advance.
Gold for June delivery gained $3, or 0.2%, to $1,575.50 an ounce during Asian trade. The move erased Monday’s loss that left June gold at $1,572.50 on the Comex division of the New York Mercantile Exchange.
The gain came as the dollar weakened against the euro, providing a lift for dollar-denominated gold prices. The euro traded at $1.3045, higher than late Monday’s level around $1.3004.
The dollar also slipped against the Australian dollar on Tuesday after Chinese consumer inflation data for March came in below expectations. The Aussie is sensitive to Chinese economic indicators as China is Australia’s largest trading partner.
A weaker dollar tends to boost commodities priced in dollars as it makes them less expensive to holders of other currencies. The ICE dollar index , which measures the greenback against a basket of six major rivals, fell to 82.587 from 82.752 late Monday.
Gold was hurt Monday by strengthening in the greenback, as well as continued outflows from gold exchange-traded funds. Data showed that holdings in the SPDR Gold Trust fell to 38.75 million ounces on Friday, down from 38.78 million Thursday. Shares in the world’s largest gold-backed ETF finished 0.7% lower on Monday.
For the week ahead, gold investors will be looking for minutes due Wednesday from the U.S. Federal Reserve’s meeting on March 20, at which monetary policy makers decided to continue with its program of buying $85 billion a month in assets.
Marketwatch
