Gold traded near recent highs on Wednesday as traders worried about geopolitical tensions in the Ukraine along with lackluster US data. Market focus will
Gold was above $1,340 yesterday, holding onto four month highs on uncertainty over China´s economic policy moves and with weaker data raising questions about the strength of the US recovery. Investors have poured back into the metal, which has risen 11 percent since the beginning of the year, on worries about economic conditions in the United States and in China, which is now dealing with unprecedented growth in corporate debt. SPDR Gold Trust, the biggest bullion-backed exchange-traded product, were unchanged on Wednesday after gaining for three days, and are heading for the first monthly expansion since December 2012.
The shiny metal is headed for a second month of advance, the longest such run since August, as concern that the U.S. recovery may be faltering and unrest in emerging markets boosted demand for a store of value. Gold added 10 percent this year, rebounding from the biggest annual decline in more than three decades, even as the Fed started to reduce its asset purchases.
Russian President Putin ordered military exercises amid deepening tensions in Ukraine, where lawmakers are set to approve Arseniy Yatsenyuk as prime minister today after a three-month uprising that ousted Viktor Yanukovych.
Copper took its clues from silver plummeting 6 points to trade at 3.192 after a serious tumble on Wednesday as traders worried about Chinese credit and the overall economy. An official gauge of manufacturing for China due March 1 probably slowed this month, according to economist estimates compiled by Bloomberg. A private measure released last week fell to a seven-month low. Copper stockpiles monitored by the Shanghai Futures Exchange swelled to a nine-month high, bourse data showed Feb. 21. Copper slipped to the lowest price in more than two months amid concern that China’s growth is slowing and as stockpiles rose in the biggest user. Sentiment is souring as traders, impatient for signs that the industry is ramping up after the Lunar New Year, are facing slowly filling order books, while falling property prices in China have dented the appeal of copper imports for financiers.
But orders may yet pick up as March gets underway for the seasonally strongest second quarter of demand, suggesting prices may not fall too far from here, said Sijin Cheng, analyst at Barclays in Singapore.