Gold Recovers as Physical Demand Grows

Gold was little changed below a two-week high as investors weighed signs of more physical buying against the dollar’s advance.

Rising imports of gold in India is a positive sign and overall purchases of the metal will help support prices through November, Barclays Plc wrote in a report today. Trading today on the Shanghai Gold Exchange’s benchmark bullion spot contract was the highest since April 2013.

The Bloomberg Dollar Spot Index traded near a five-year high after a report showed Japan’s economy unexpectedly sank into a recession. Bearish wagers on gold futures and options by hedge funds are near a record, according to U.S. government data. Bullion is down 1.2 percent this year.

“The market is fundamentally weak,” David Govett, head of precious metals at broker Marex Spectron Group in London, said in a note. “I don’t believe this is the beginning of a sustained up move, but one has to be very careful when the scales are tipped too heavily on one side.”

Gold for December delivery added 0.2 percent to $1,188.40 an ounce by 7:19 a.m. on the Comex in New York. It reached $1,193.60 earlier today, the highest since Oct. 31. Bullion for immediate delivery was little changed at $1,189.30 in London, according to Bloomberg generic pricing.

Futures trading volume was more than double the average for the past 100 days for this time of day, data compiled by Bloomberg show.

via Bloomberg

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.