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Gold Gains on QE3 Hopes
Jun 14,2012 10:53CST
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Source:SMM
Gold futures on the COMEX division of the New York Mercantile Exchange rose Wednesday.

CHICAGO, June 13 (Xinhua) -- Gold futures on the COMEX division of the New York Mercantile Exchange rose Wednesday, as disappointing U.S. macroeconomic data spurred traders'hopes for more quantitative easing policies from the U.S. Federal Reserve Bank.

The most active gold contract for August delivery gained 5.6 U. S. dollars, or 0.35 percent, to settle at 1,619.4 dollars per ounce.

Gold extended its winning streak to four days Wednesday, with futures now closing two percent higher since Friday.

Gold gained momentum following the morning release of weak U.S. macroeconomic data. According to the Department of Labor, the U.S. producer price index fell one percent in May due to reduced costs for food and energy. It was the biggest one-month drop in nearly three years, and the second-straight monthly decline for the index.

Separately, the Department of Commerce reported that on a seasonally adjusted basis, U.S. retail sales fell 0.2 percent in May. Revised data showed that April retail sales also fell, meaning that there were two consecutive months of decline,the first time in two years.

Gold sparked on the poor U.S. data due to the precious metal's safe haven appeal, and also because traders hoped that recent economic struggles might move the U.S. Federal Reserve Bank to institute another round of quantitative easing policies.

Gold also found outside market support Wednesday in a declining dollar. A weaker greenback is a positive for commodities markets such as gold, as it makes them less expensive to holders of other currencies.

Silver for July delivery edged down 0.8 cents, or 0.03 percent, to settle at 28.941 dollars per ounce.
 

Gold futures price

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