Gold inched up by $ 1 an ounce on Monday to remain near 9-week highs Investing.com — Gold was relatively flat on Monday amid a moderately stronger dollar, as investors remained focus on economic and political turmoil in China and the Middle East.
On the Comex division of the New York Mercantile Exchange, gold for February delivery traded between $ 1,096.00 and $ 1,108.30 an ounce, before settling at $ 1,098.80, up 1.00 or 0.09% on the session. Gold remained near nine-week highs from late last week when the precious metal surged above $ 1,110 an ounce, as investors flocked to the safe-haven asset when a massive rout among Chinese equities spilled over into global markets. Gold has closed higher in eight of the last nine sessions and nine of the last 13 dating back to Christmas eve. Since falling to fresh six-year lows in early-December, gold has gained more than 4.25% in value.
Gold likely gained support at $ 1,046.20, the low from December 3 and was met with resistance at $ 1,162.00, the high from Oct. 29.
On Monday, the People’s Bank of China (PBOC) attempted to soothe markets by setting the daily fix for the yuan against the dollar in comparison with its level at last week’s close. While the Chinese currency surged against the dollar in offshore trade, Chinese equities continued to plunge – extending severe losses from the opening week of the year.
The PBOC set the yuan’s midpoint at 6.5626 per dollar on Monday, substantially higher than last Thursday’s level when it experienced its worst one-day decline in five months. Over the course of a trading day, the PBOC intervenes to prevent the exchange rate from drifting 2% above or below the midpoint. The PBOC devalued the yuan 1.6% last week, after lowering it by nearly 5% against the dollar in 2015 in an effort to stimulate its economy by boosting exports. Weak manufacturing and service sector data for December exacerbated fears that the world’s second-largest economy finished last year with the slowest GDP growth in nearly a quarter-century.
Investors await the release of China trade data on Wednesday for further indications on the strength of the Chinese economy. The monthly trade report for December is expected to show that the country’s narrowed to $ 53.0 billion from $ 54.1 billion in November. In addition, last month are expected to slump 8.0% on a yearly basis, while economists expect to plummet 11.5%, after falling nearly 9% a month earlier.
Metal traders also reacted to reports of an attack at a mall in Baghdad, where gunmen reportedly set off a car bomb at the entrance, killing at least 10. The mall is located in eastern Baghdad, an area predominantly occupied by Shiite Muslims. Gold’s appeal as a safe-haven asset has accelerated since a in Saudi Arabia on Jan. 2, triggering the latest round of sectarian discord in the region.
The , which measures the strength of the greenback versus a basket of six other major currencies, gained more than 0.25% to an intraday high of 98.91. The index remains near 12-month highs from December, when it eclipsed 100.00. Dollar-denominated commodities such as gold become more expensive for foreign purchasers when the dollar appreciates.
Silver for March delivery gained 0.047 or 0.34% to 13.965 an ounce.
for March delivery plunged 0.051 or 2.51% to 1.972 a pound.
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Gold comparatively flat, as China and Center East considerations stay in focus
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