Monday, June 01, 2020

Gold remains firm as central banks loosen monetary policy to cope with crisis

Mar 31. 2020
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By The Nation

Gold price was unchanged in Tuesday morning trade, the Gold Traders Association reported.

As of 9.31am, buying price of a gold bar was Bt24,700 per baht weight and selling price Bt24,900, while buying price of gold ornaments was Bt24,256 per baht weight and selling price Bt25,400.

At close on March 28, the buying price of a gold bar was Bt24,750 and selling price Bt24,950, while the buying price of gold ornaments was Bt24,301.48 and selling price Bt25,450.

Gold contracts in COMEX futures to be delivered in April dropped by US$10.90, closing at $1,643.20 per ounce on Monday (March 30) due to investors selling gold to make profit and the US dollar’s recovery after weakening for four consecutive business days after the euro and the pound were weakened by uncertainty about the Covid-19 pandemic in Europe.

However, the decline in gold price is limited as central banks worldwide moved to loosen monetary policy, such as cutting interest rates, injecting money, and using quantitative easing to deal with the economic impact caused by Covid-19 pandemic which would be positive sentiment for gold price.

A strategist at YLG Bullion and Futures advised investors to take profit from short-term volatility between US$1,630 and $1,646 per ounce.

“We evaluate the support line at between 1,585 to 1,608 and resistance line at between 1,630 and 1,661,” the strategist said.

“We recommend following the central bank’s disclosure of Purchasing Managers Index in Chicago and Consumer Confidence Index in March,” the strategist said.

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