Gold rallied on inconsistent economic growth at US and Festival demand at China. The metal gained by 0.47% and made the month high above $1260 today at Singapore market.
The precious metal dropped to $1181.24 on 31st December highest since 1981 but regained on increase in haven asset demand. Investors are taking bullish bets as US economy has shown mix results for this month. There is less expectation of further stimulus cut in the Central Bank Meet on January 28-29.On the other side China, which has already crossed India in largest import of this metal, has seasonal demand of Gold due to the Spring Festival aka Lunar New Year that will begin from 31st January.
In SPDR, world largest gold backed exchange traded fund, holding rose by 7.49 tonnes to 797.05 tonnes on Friday. Fall in stock indices of US and Asia indicates that investors are exiting from equity market and investing in precious metals. Platinum climbed on chances for strikes in South Africa.
On the other side dollar has remained stable against the basket of 10 major currencies. Dollar index is above 81.0 and may strengthen little if this week Unemployment claims and Existing Home Sales result in positive numbers. Strong dollar is a negative sign for Gold and it may pull prices down in near time.