LONDON: Gold eased on Thursday as investors booked profits from recent rallies but held above the $1,550 technical support level on continuing low interest rates and a drop in risk appetite.
Spot gold was down 0.2 per cent to $1,556.05 per ounce by 1340 GMT. US gold futures were little changed at$1,555.70 per ounce.
“From the beginning of the year, gold has rallied and that had led investors to take positions and now in the absence of any major news (on fundamentals), they are booking some profit,” said Frederic Panizzutti, managing director at MKS Dubai.
Gold broke above the psychological barrier of $1,500 an ounce in late December on uncertainty surrounding the US-China trade deal and the global economy.
Bullion climbed further to a near-seven-year peak of $1,610.90 on Jan. 8 after an escalation in US-Iran tensions and has held above $1,550 for the most part ever since.
“In the long term, the market is still bullish,” Panizzutti added, pointing to geopolitical uncertainties and low interest rates that reduce the opportunity cost of holding non-yielding bullion.
The European Central Bank kept interest rates unchanged at its latest policy meeting on Thursday and launched a “strategic review” of its inflation goal and tools.
Among other precious metals, palladium fell 1.2pc to $2,443.29, silver dipped 0.5pc to $17.73 and platinum was also down 0.8pc at $1,003.95.
Published in Dawn, January 24th, 2020