Gold rises to snap longest skid in 17 years

Bloomberg

15 Mar, 2015 09:10 PM2 mins to read

Gold for immediate delivery rose 0.1 percent to $1,154.73 an ounce at 2:27 p.m. New York time, according to Bloomberg generic pricing. Photo: AP.

Gold rose Friday, halting the longest slump in 17 years, on speculation that the Federal Reserve will hold off raising U.S. interest rates in June.

U.S. wholesale prices in February unexpectedly dropped for the fourth straight month, reflecting a slump in profit margins among wholesalers and retailers, government data showed Friday. Consumer confidence declined in March to a four-month low, according to a University of Michigan index.

Gold's 14-day relative-strength index has been below 30 this week, signaling a rebound to some traders. Volume for the Shanghai Gold Exchange's benchmark spot contract on Friday rose to the highest in a month.

"Long term, you would say the U.S. economy is just not humming, it's sputtering, and that's the cry for interest rates to stay lower longer," James Cordier, the founder of Optionsellers.com in Tampa, Florida, said in a telephone interview.

"There's no way the Fed is raising rates in June, and these economic numbers that are coming out suggest they're going to have to hold off for some time."

Gold for immediate delivery rose 0.1 percent to $1,154.73 an ounce at 2:27 p.m. New York time, according to Bloomberg generic pricing.

The price dropped 4.9 percent in the previous nine sessions, the longest slump since January 1998.

On Thursday, global holdings in exchange-traded products back by gold dropped for the 12th straight session, the longest slump since January 2014, according to data compiled by Bloomberg. Assets at 1,643.5 tons have dropped to the lowest since Jan. 22.

The dollar on Friday rose as much as 0.9 percent to an 11- year high against a basket of six currencies.

Gold futures for April delivery climbed less than 0.1 percent to settle at $1,152.40 on the Comex in New York.

Silver for immediate delivery fell 0.3 percent to $15.5528. The price headed for the second straight weekly drop.