Gold Futures Advance on Haven Appeal Amid Greek Debt Concerns

PT. Equityworld Futures - Gold futures rose on demand for a haven as Greece remained locked in negotiations to secure funding and avoid a default.
Greek government bonds were set for their worst week since the aftermath of the Syriza party’s election in January. The nation faces payments of almost 1 billion euros ($1.1 billion) next month. Earlier, gold climbed as much as 0.8 percent to $1,207.80 an ounce.
Two Federal Reserve officials have said that a recent run of weak U.S. economic data makes them wary of raising borrowing costs too soon, reinforcing forecasts that the Fed will wait until September to tighten. Higher interest rates damp the appeal of gold, which generally offers returns only through price gains.
Gold futures for June delivery climbed 0.4 percent to settle at $1,203.10 at 1:50 p.m. on the Comex in New York. The metal has climbed 5.4 percent from a four-month low of $1,141.60 on March 17.
The cost of living in the U.S., excluding fuel and food, rose 0.2 percent in March, signaling that inflation is starting to firm. Some investors buy gold as a hedge against higher consumer prices.
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Gold Falls Fourth Time in Five Days as Rising Dollar Cuts Demand

PT. Equityworld Futures - Gold futures declined for the fourth time in five sessions after a rise in the dollar cut demand for the metal as an alternative investment.
The Bloomberg Dollar Spot Index climbed to a three-week high as signs of a slowdown in China highlighted the diverging fortunes of the world’s two biggest economies, enhancing the appeal of the U.S. currency.
Gold has posted two straight monthly declines after the greenback rose to the highest since at least 2004 against a basket of 10 currencies and concern mounted on prospects for higher U.S. borrowing costs. Speculation that global central banks will push for more economic stimulus helped limit declines in bullion on Monday.
On the Comex, gold futures for June delivery slid 0.4 percent to settle at $1,199.30 an ounce at 1:45 p.m. in New York.
Fed policy makers were split at last month’s meeting on when to begin raising rates. Rising rates curb gold’s appeal because the metal generally only offers returns through price gains, prompting investors to favor assets with better yield prospects such as equities and bonds.
Silver futures for May delivery slid 0.6 percent to $16.291 an ounce on the Comex. The metal has posted two straight weekly declines.
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Citigroup: '2016 to 2020 Period Could Be Supportive for Gold'

PT. Equityworld Futures - This year hasn't been a banner one for gold, with the precious metal advancing just 1 percent so far, but the precious metal might fare better next year, says Citigroup analyst Jon Bergtheil.
A strong dollar, low inflation and expectations of a Federal Reserve interest-rate increase later this year have put a lid on gold in 2015.
The precious metal has been trading around $1,200.
"Gold is still extremely vulnerable during 2015, but the 2016 to 2020 period could be supportive for gold," Bergtheil writes in a report obtained by MarketWatch.
Gold is suffering now because massive global central bank easing hasn't sparked inflation as was expected, he said. U.S. consumer prices were unchanged in the 12 months through February.
"Money printing had almost always resulted in inflation but in today's excess global production capacity environment and with the oil price having collapsed, that inflation has been deferred," he notes.
But once all the monetary stimulus and currency devaluations overseas lead to inflation and oil prices stabilize next year, gold will benefit, Bergtheil maintains.
He notes that the precious metal has shown strength this year in not succumbing to the dollar's surge.
"When indexed to January 2014, peer metals silver, platinum and base metals are all still clustered closely to the [inverse] U.S. dollar index in April 2015. Gold, by contrast, dislocated from these other metals and from the dollar in the past year."
Some experts say recent U.S. economic weakness is supporting gold too. That weakness has led economists to forecast a more gradual process of interest-rate increases by the Federal Reserve. Lower rates often boost gold because they are more conducive to inflation.
The central bank has kept its federal funds rate target at a record low of zero to 0.25 percent since December 2008. Many economists predict the Fed won't raise rates until September. And some go even further than that.
"There are a growing number of traders and market watchers who believe the U.S. Federal Reserve will not be able to raise interest rates in 2015, due to the lackluster growth of the U.S. economy," Jim Wyckoff, an analyst at Kitco.com, a precious metals web site, writes in a commentary obtained by The Wall Street Journal.
"A less hawkish Fed . . . has in recent years been a major bullish factor for the gold and silver markets."
The economy grew only 2.2 percent in the fourth quarter, and some analysts predict the figure will be much lower for the first quarter.
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Gold Futures Drop to Two-Week Low on Fed Interest-Rate Outlook

PT. Equityworld Futures - Gold futures fell to the lowest in almost two weeks on speculation that a smaller-than-expected gain in U.S. retail sales won’t be enough to keep the Federal Reserve from raising interest rates this year.
Purchases at U.S. retailers increased 0.9 percent, the first gain in four months, after a 0.5 percent drop in February, government figures showed Tuesday. The median forecast of 87 economists surveyed by Bloomberg called for a 1.1 percent advance.
Gold futures for June delivery fell 0.6 percent to settle at $1,192.60 an ounce at 1:48 p.m. on the Comex in New York, after reaching $1,183.50, the lowest since April 1.
Silver futures for May delivery declined 0.8 percent to $16.161 an ounce on the Comex, also the fifth loss in six sessions.
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