London: Gold eased on Thursday as investors booked some profit from the metal’s strong run this week, but bullion held near a two-week peak supported by concerns over an economic slowdown, as major central banks retained a dovish policy stance.
Spot gold was down 0.2 per cent at $1,304.63 per ounce by 1011 GMT. It touched its highest since March 28 at $1,310.50 on Wednesday.
US gold futures were about 0.4 per cent lower at $1,308.50 an ounce. Spot prices have rebounded from a near 10-week low touched last week at $1,280.59.
Gold is being pressured by some profit-taking following the past week’s gains, especially with the climb above $1,300, OANDA senior market analyst Craig Erlam said.
“One of the reasons we are trading around $1,300 levels is the dovish stance of central banks,” he said.
The dollar was little changed against rival currencies, hovering near a two-week low after the US Federal Reserve’s minutes cemented the central bank’s dovish policy stance amid risks of a global economic slowdown.
European Central Bank President Mario Draghi raised the prospect of more support for the struggling Eurozone economy on Wednesday if its slowdown persisted, and kept its ultra-easy monetary policy unchanged.
Low interest rates reduce the opportunity cost of holding non-yielding bullion, widely viewed as a safe investment during times of political and economic uncertainty.
World stock markets moved away from six-month highs as investors weighed warning signs over growth from major central banks.
“The yellow metal should see support toward $1,300-$1,305, while a consolidated break through $1,310 should see further interest,” MKS traders said in a note.
Traders are also closely following developments in Brexit after European Union leaders gave Britain six more months to leave the bloc.
Also on investors’ radar is US-China trade, with Washington and Beijing having largely agreed on a mechanism to police any agreement they reach, including establishing “enforcement offices”, US Treasury Secretary Steven Mnuchin said. Talks resume on Thursday.
Spot platinum was flat at $900.95 per ounce.
Palladium was down 0.9 per cent at $1,375.34 per ounce, while silver slipped 0.3 per cent to $15.15.
