Gold recovers to above $1,130/oz as US dollar eases

The spot gold price recovered to above $1,130 per oz during Asian trading hours on Wednesday December 21 as the US dollar eased.

The spot gold price was recently quoted at $1,135.40/1,135.70 per oz, up $3.55 on the previous close. Trade has ranged from $1,129.45 to $1,135.95 so far.

The spot gold price fell to as low as $1,125.85 per oz on Tuesday – the lowest since December 15 – while the US dollar index surged to as high as 103.65 on the same day, the highest since 2002.

The US dollar had surged on Tuesday after the Bank of Japan left its monetary policy unchanged and upgraded its economic outlook on Tuesday.

“Although there was a slightly more positive assessment of the economic outlook, inflation expectations were noted to be weakening and the BoJ remains committed to keep expanding the money base until inflation exceeds 2%,” National Australia Bank said on Wednesday morning.

The US dollar index has eased to 103.11 so far on Wednesday, down 0.16% from the previous day’s close.

A string of US data is due over the next few days which could provide direction for the spot gold price, China’s Zhengjin Precious Metals said on Wednesday morning.

The broker sees short-term support for the spot gold price at $1,120 per oz and resistance at $1,150.

Existing home sales and crude oil inventories from the US are due later today. Key US economic data to be released over Thursday-Friday includes core durable goods orders, final GDP, unemployment claims, core PCE price index, new home sales and revised UoM consumer sentiment.

In data released Tuesday, the Chinese CB leading index data for November was at 1% against 0.8% in the previous month.

In equities, the Shanghai Composite rose 0.79% to 3,127.28 so far on Wednesday.

In other commodities, the Brent crude oil spot price decreased 0.02% to $55.52 per barrel recently.

In the other precious metals, the spot silver price increased $0.065 to $16.09/16.11 per oz. Platinum gained $4 to $917/922 per oz, and palladium increased $5.50 to $666/671 per oz.

On the Shanghai Futures Exchange, gold for June delivery was recently at 264.75 yuan ($38) per gram, and the June silver was at 4,039 yuan per kg.

(Editing by Kyle Docherty)

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