Gold rose from its lowest level in more than a week in New York after India eased some curbs on bullion imports and investors weighed Federal Reserve minutes. Palladium futures were near a 33-month high.
Bullion fell as much as 0.9 percent yesterday, before paring some of the losses, as Federal Reserve minutes showed policy makers said continued stimulus to push unemployment lower doesn’t risk sparking an undesirable jump in inflation, while some members said the Fed should communicate its strategy more clearly as it moves closer toward increasing interest rates.
India was replaced by China as the biggest gold user last year after the government curbed imports. Inbound shipments will probably rise after the Reserve Bank of India allowed more firms to buy metal from overseas, said Bachhraj Bamalwa, a director with the All India Gems & Jewellery Trade Federation. Palladium climbed 16 percent this year as a strike in South Africa cut supply and as U.S. and European leaders threatened top supplier Russia with sanctions over the Ukraine standoff.
“The Indian government made its first move towards loosening the restriction on importing gold, albeit a very small one,” David Govett, the head of precious metals at Marex Spectron Group in London, wrote today in a report. “This has helped underpin the price, but we will need a lot more before Indian imports can reach the heady heights of 2012 and 2013. Platinum and palladium will continue to be supported with the ongoing situation in South Africa and the Ukraine.”