Gold jumps B300 on weak US data

Gold prices surged 300 baht per baht weight at 9.20am on Saturday.

The Gold Traders Association announced the buying price at 19,800 baht and the selling price at 19,900 baht per baht-weight for gold bars.

The buying price for gold ornaments was 19,510.92 while their selling price was 20,300 baht per baht-weight.

The prices were adjusted three times on Friday for a total loss of 150 baht per baht weight from the previous close on Thursday.  

In world markets, Bloomberg reported from New York on Saturday gold futures rose, capping the biggest monthly gain in three years, after US government data showed the economy expanded at a slower pace than forecast in the fourth quarter, reigniting demand for the metal as a haven.

A widening trade gap limited expansion for gross domestic product as imports climbed three times faster than exports, Commerce Department figures showed. The metal extended gains as US equities fell on economic concerns, adding to gold’s appeal as an alternative investment.

Futures rose the most in two weeks amid speculation that weaker foreign economies will be a drag on American growth, prompting the Federal Reserve to wait longer before raising interest rates. Assets in global exchange-traded products backed by gold climbed for 10 straight sessions to the highest since October, data compiled by Bloomberg show.

“Gold has found a bit more of a bid with the lower-than-expected GDP number,” David Meger, the director of metal trading at HighRidge Futures in Chicago, said in a telephone interview. “The Fed can be more patient in raising rates, and that’s supportive for precious metals.”

On the Comex, gold futures for April delivery rose 1.9% to settle at $1,279.20 an ounce at 1.56pm in New York, the biggest advance since Jan 15. This month, the metal increased 8%, the most since January 2012.

The economic figures Friday helped revive speculation that the US expansion will be hampered by slowdowns in Europe and Asia. On Jan 29, gold tumbled 2.4%, the most since 2013, after the Fed a day earlier raised its assessment of the US economy and labour market. This week, the metal dropped 1.1%.

“The buyers don’t see a lot of sellers because they were exhausted from yesterday,” George Gero, a precious-metal strategist at RBC Capital Markets in New York, said in a telephone interview.

US ETPs backed by precious metals took in $1.9 billion this month through Jan 28, the first inflow since July and the most since September 2012, data compiled by Bloomberg show.