Gold retains gains on Fed stimulus hopes

Gold is holding steady after rallying to its highest in six and a half months in the previous session as a sharply disappointing US employment report fuelled expectations for imminent easing from the Federal Reserve.
Nanjing Night Net

Spot gold was little changed at $US1734.64 an ounce, after rising to $US1741.30 the session before, its highest since Feb 29.

US gold edged down 0.2 per cent to $US1737.40, holding onto its 3-per cent gain from last week.

US jobs growth slowed sharply in August, setting the stage for the Fed to pump additional money into the sluggish economy at a meeting this week.

A Reuters poll of 59 economists gave a 60 per cent chance the Fed will announce another round of quantitative easing, or QE3, at the conclusion of its Sept. 12-13 gathering.

China’s factories ran at their slowest rate for 39 months in August, while a double-digit rise in fixed asset investment showed that infrastructure spending remained key to economic growth.

Holdings of gold-backed exchange-traded funds rose to a fresh record high of 72.125 million ounces on Friday.

Hong Kong shipped nearly 76 tonnes of gold to China in July, up 12 per cent on the month, while it received nearly 30 tonnes of gold from China, the Hong Kong Census and Statistics Department said.

Silver and platinum hovered near the multi-month highs hit on Friday. Spot silver inched down 0.2 per cent to $US33.60, near a six-month peak of $US33.71, and spot platinum gained 0.7 per cent to $US1,592, after breaking above $US1,600 for the first time in five months.

Reuters

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