Home / Metal News / Gold Solidly Higher on Short Covering, Bullish Outside Markets

Gold Solidly Higher on Short Covering, Bullish Outside Markets

iconSep 17, 2015 16:22
Source:SMM
Gold prices ended the U.S. day session with good gains Wednesday, on position-evening and short covering just ahead of what is arguably the most important U.S. economic event in months.

By  Paul Ploumis 17 Sep 2015  Last updated at  04:02:09 GMT

(Kitco News) - Gold prices ended the U.S. day session with good gains Wednesday, on position-evening and short covering just ahead of what is arguably the most important U.S. economic event in months. Bullish “outside market” forces were also working in the precious metals bulls’ favor today, as the U.S. dollar index was lower and crude oil prices were sharply higher. December Comex gold was last up $16.80 at $1,119.50 an ounce. December Comex silver was last up $0.559 at $14.89 an ounce.

There may have even been bit of safe-haven demand in the gold market today, on news that a contingent of U.S. military personnel is on the ground in Syria, fighting terrorists.

The U.S. consumer price index for August was reported Wednesday and came in at up 0.1%, which was right in line with market expectations and had little impact on markets. In overnight news, inflation in the Euro zone declined in August. The reading was up 0.1%, year-on-year, versus up 0.2% in July. This news again fall into the camp of the European Central Bank monetary policy doves.

Asian stock markets were higher Wednesday, led by China’s Shanghai stock index that was up nearly 5% on the day. There were rumors the China government may not force securities firms to shut down trust fund trading accounts. Japan’s Nikkei stock index was up 0.8% Wednesday.

The OECD think tank has again lowered its forecast for annual world economic growth, mainly due to the problems with China’s economy. The OECD on Wednesday forecast world economic growth at 3.0% in 2015 versus its June estimate of 3.1% growth. The group said China’s economic problems are serious and will continue to impact the world’s major economies.

The focus of the world marketplace is on the Federal Open Market Committee meeting that began Wednesday morning and ends Thursday afternoon. A statement and press conference from Fed Chair Janet Yellen are set for Thursday afternoon. While there is no consensus among traders and investors on whether the Fed will or won’t make an interest rate hike for the first time in several years at this week’s meeting, just this week there seems to be a growing sense the Fed will make a rate hike at this meeting. Rising U.S. Treasury bond and note yields (falling prices) this week are suggesting the Fed will raise interest rates on Thursday.

The London P.M. gold fix today was $1,117.60 versus the previous London A.M. fixing of $1,109.75.

Courtesy: Kitco News


Gold prices
US rate hike

For queries, please contact Lemon Zhao at lemonzhao@smm.cn

For more information on how to access our research reports, please email service.en@smm.cn

Related news