Gold price edges higher on ETF inflows but remains vulnerable

Gold edged higher on the morning of Monday, October 17 in London, supported by strong inflows to precious metals-backed exchange-traded funds (ETFs), market participants said.

The spot gold price was recently at $1,253.40/1,253.70 per oz, up $3.30 on the pre-weekend close. Trade has ranged from $1,250.65 to $1,256.20 so far.

Holdings in the gold ETFs have increased 19 tonnes since the start of the month, which is more than in the whole of September, Commerzbank noted.

But gold faces headwinds from the firm dollar, which reached a 10-week high against the euro this morning, and from rising stock markets and higher bond yields, the bank said.

“Gold prices remain vulnerable while they trade in a tight range after the recent fall below $1,300,” Metal Bulletin’s William Adams said. “Another leg lower cannot be ruled out although the market has had to absorb a lot of fund selling so there appears to be good underlying buying around, albeit not from the funds trading Comex.”

In the other precious metals, spot silver was unchanged at $17.365/17.405 per oz. Platinum at $934/939 was up $6 and palladium edged $1.50 lower to $645/650.

(Editing by Mark Shaw)

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