LONDON, Jan 5: Gold trimmed losses in Europe on Thursday and held closer to last month’s near-25-year highs, with positive fundamentals and macro-economic factors seen lifting the metal.
Profit-taking in Asian trade had dragged the metal below $530 an ounce, but new buyers quickly moved in to support.
The positive sentiment remains very strong and people are looking for further price gains, said Yingxi Yu, precious metals analyst at Barclays Capital.
Any price dip has been quite well supported by fund buying and aggressive selling has been discouraged.
Spot gold was quoted at $531.00/531.75 after dipping to $529.80, compared with $534.20/534.90 in New York late on Wednesday, when rose nearly $4 on fund buying.
It hit $540.90 in early December.
But firm gold prices, which surged more than 18 per cent in 2005 and have almost doubled in five years, kept jewellers largely away from the market in parts of Asia. Sales of gold scrap were reported.
Market sentiment remains firmly bullish with chart support pegged at $525-$528 while traders continue to target the December high, James Moore of TheBulliondesk.com said in a report.
Japanese players were active overnight, with the Tokyo Commodity Exchange’s December contract rising 2 yen per gram to 2,016 yen ($17.33).
Premiums for gold bars were steady at between 10 and 40 US cents an ounce to the spot London price in Singapore, a centre for bullion trading in Southeast Asia.
The dollar made a slight recovery against the euro after a two-day battering driven by expectations the Federal Reserve was close to ending its campaign of US interest rate rises.
Oil remained firm above $63 a barrel as dealers waited to see if an expected draw on US commercial crude oil stocks would help extend a rally.
Gold is seen as a hedge against inflation led by high oil prices.
In other precious metals, platinum fell to $987/991 an ounce from $990/995 in New York, while palladium was down at $265/270 from $269/274.
Silver eased to $9.00/9.03 an ounce from $9.12/9.15.—Reuters
