Gold falls from record on profit taking
Investors took advantage of record high prices set by Gold in yesterday's trading session, awaiting rate decision releases from Bank of England and European Central Bank, with expectations that the ECB will hike rates to control inflation.
Investor's desires to hedge against inflation forced the metal to set new record at $1,462.12 an ounce, where fears of inflation intensified after China hiked rates for the third time this year, while price acceleration in Europe was noted during the past period to surpass the desired rate set by central banks in the continent.
Bullion for immediate delivery traded at $1,453.21 an ounce compared with the opening levels of $1,459.47 an ounce, while setting a high of $1,461.90 an ounce and a low of $1,452.76 an ounce. Futures fell 0.19% to trade at $1,455.800 an ounce.
The US dollar index, which tracks the performance of the currency against six-majors, traded at 75.69, compared with the opening levels of 75.55 while setting a high of 75.69 and a low of 75.50. Gold usually moves inversely with the dollar as commodities are a dollar weighted index.
Today's rate decision by ECB is highly expected to witness tightening of monetary policy as inflation spiked in the euro-area to the fastest pace in two-years. BoE rate decision isn't likely to witness the same even though inflation rates surged to 4.4 percent last month and is expected to rise above 5.0 percent this year.
Technically speaking, gold's trend remains to the upside as far as the support at $1,390.00 an ounce remains intact and the dollar continues to weaken, while the 100-day MA support level is set at 1,374.00 an ounce.
Gold's trading remains above the support at 1,425.00 an ounce, where if breached it will pave the way for the pair to test the support at %1,410.00 an ounce, but the general trend remain to the upside with initial targets set at 1,460.00 an ounce and probably achieve new historic highs above those levels.
The S&P GSCI index closed trading at 742.09; gaining by 1.34 points, while the RJ/CRB commodity index closed at 363.46, after gaining 0.35 points.
Major Metal Fixing
As for metal Fixes (Apr 6); Gold fixed at AM Fix was set at $1,457.00 an ounce while the PM fixing (Apr 6) was set at $1,461.50 an ounce; meanwhile silver fixing was set at $39.6300 an ounce and Platinum AM Fixing (Apr 6) was set at $1,796.00 an ounce, and at 1,808.00 an ounce during the PM fixing (Apr 6); finally ending with Palladium AM fixing set at $787.00 at (Apr 6) AM fixing, while the PM fixing (Apr 6) was set at $793.50 an ounce.
Silver for immediate delivery traded at $39.30 an ounce compared with the opening levels of $39.54 an ounce, while setting a high of $39.57 an ounce and a low of $39.20 an ounce. Silver future contracts traded lower by 0.12% or 0.047 to trade at 39.340 an ounce
Platinum for immediate delivery traded lower by $7.0, at $1,774.000 an ounce, while Palladium remained unchanged at $772.00 an ounce.