FXStreet (Mumbai) – The yellow metal climbed to the highest levels since Nov 3 in early Asia as the renewed global growth concerns resurfaced following the release of weak manufacturing surveys.
Gold back below $ 1130
Currently, gold trades modestly flat at 1128.20, easing-off fresh three-month highs reached at 1130.80 at Tokyo open. Global risk-aversion was at full steam in Asia, with traders preferring to seek safety in the bullion as contraction in the manufacturing sector across the globe reinforced beliefs that the global economic outlook remains exposed to greater downside risks.
Moreover, dovish comments from FOMC member Fischer in the last NY session also diminished hopes of four rate hikes by the Fed this year and hence, lifted the non-interest bearing gold. The Fed Vice Chairman Stanley Fischer noted, if recent volatility in financial markets persists and signals a slowdown in the global economy, it could affect growth and inflation in the United States.
Further, in evidence to the increasing investors’ confidence in the precious metal, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose to 21.9 million ounces on Monday, the most since Nov. 3.
Focus now remains on the US jobs report due later this week for fresh cues on the Fed’s interest rates outlook, which could have major impact on the gold prices.
Gold Technical Levels
The metal has an immediate resistance at 1130.80 (daily high) and 1134.70 (Nov 3 High). Meanwhile, the support stands at 1124.70 (daily pivot) below which doors could open for 1121.32 (5-DMA)
(Market News Provided by FXstreet)