Gold climbed to a new monthly high on Monday as traders took advantage of the drop in the US dollar to buy up the cheaper commodity. Traders are more concerned with the upcoming FOMC meeting on January 29th. Gold is trading at 1252.50 up by $1.40 at the end of the Asian session. Gold has rebounded from a six-month low of $1,182.27 on Dec. 31, when it capped the largest annual decline since 1981, on signs of strengthening demand in China. The country probably overtook India as the largest user last year. Volumes for the benchmark contract on the Shanghai Gold Exchange fell to 14,630 kilograms yesterday, compared with an eight-month high of 24,875 kilograms a week ago. Precious metals rose to a one-month high on Monday as fresh losses in U.S. equities triggered safe-haven buying and extended the previous session’s bullion rally sparked by lackluster U.S. nonfarm payrolls data. The Dow fell 200 points on Monday as traded began to worry about corporate earnings as data season begins this week.
Information from the U.S. Mint showed gold-coin sales were 63,000 ounces yesterday, topping the 56,000 ounces sold in all of December. The U.K.’s Royal Mint last week said it ran out of 2014 Sovereign gold coins on “exceptional demand.” Assets in the SPDR Gold Trust, the biggest bullion-backed exchange-traded product, were unchanged for a third day yesterday after sliding to a five-year low of 793.12 metric tons on Jan. 8.
Industrial metals rose on Monday, lifted by a weaker dollar after worse-than-expected U.S. labor market data reinforced the view that the U.S. Federal Reserve is likely to be cautious in scaling back its bond-buying stimulus program. Platinum reached $1,443.55 an ounce. The most powerful union at the world’s three biggest platinum producers plans meetings with its members this week in South Africa to test whether workers want to strike over pay. Silver dropped 0.3 percent to $20.3368 an ounce after climbing to $20.4657 yesterday, the highest since Dec. 11. Palladium traded at $740 an ounce from $740.05 yesterday, when the metal rose to $746.65, the highest price since Nov. 12.
Copper is up by 4 points this morning trading at 3.344. Depressed copper prices, pushed down by wavering confidence over China’s economic strength, attracted record inflows to ETF Securities’ ETPs for the industrial metal last week. The Chinese government is trying to reform to avoid its economic dilemmas. Simply put, the new Chinese leader Xi Jinping and his colleagues must implement enough reform while ensuring that growth does not fall off quickly. Copper started the year robustly, but weaker than expected Chinese exports combined with lower HSBC/Markit PMI results for December sent it below $7,230 (£4,395) a ton. It recovered to end the week with only a 2.4 per cent fall from the previous week.