SINGAPORE: Gold dipped slightly on Wednesday but held near an 11-month high hit as uncertainty over Spain's bailout plan kept investors on their toes while they wait for a key US job market report expected to show the effectiveness of the latest stimulus.
Gold barely moved from the end of last week after posting a fourth straight month of gains in September, spurred by the aggressive stimulus measures of central banks, including the Federal Reserve and European Central Bank.
But the momentum fizzled in the absence of a fresh catalyst, while investors await the latest development in the bailout plan of Spain, now the centre of the euro zone debt crisis, after the country's Prime Minister Mariano Rajoy denied a Reuters report of an imminent request for bailout.
"The real challenges will again drive the market," said Jeremy Friesen, a commodity strategist at Societe Generale in Hong Kong.
"We are going through a bit of a consolidation period until we see what happens. My suspicion is that we'll get more monetary policy responses from other central banks as the Fed programme kicks off and the ECB programme starts, probably by the end of this month. That's bullish for commodities like gold."
Gold is forecast to reach an average of $1,800 an ounce in the first quarter of 2013 as a result, he added.
Spot gold inched down 0.1 percent to $1,771.86 an ounce by 0319 GMT. It hit $1,791.20 this week, its highest level since last November.
US gold was little changed at $1,774.40.
Technical analysis suggested that spot gold could fall to $1,737.50 an ounce during the day, said Reuters market analyst Wang Tao.
Comments
Comments are closed.