Gold surges B250 at B21,300

Gold surges B250 at B21,300

Gold prices jumped 250 baht to 21,300 baht per baht-weight in Bangkok on Saturday.

The Gold Traders Association announced the buying price at 21,200 baht and the selling price at 21,300 baht per baht-weight for bullion.

For ornaments, the buying and selling prices were 20,890.48 baht and 21,700 baht per baht-weight respectively.

The prices changed seven times on Friday, indicating high volatility, for a net gain of 250 baht.

Reuters reported from London gold hit a seven-week peak on Friday and silver its highest since January last year as the Bank of Japan's decision the previous day to hold off expanding monetary stimulus weighed on stock markets and the dollar.

The US unit posted its biggest daily loss against the yen in more than five years on Thursday after the BoJ decision, and fell another 0.3% against a currency basket on Friday. That lifted precious metals, which are priced in dollars.

Spot gold was up 0.7% at $1,274.52 an ounce at 0930 GMT, having earlier peaked at $1,280.60 an ounce. US gold futures for June delivery were up $10.70 an ounce at $1,277.10.

For the week, the metal is up 3.5% in what would be its biggest weekly jump since the week ended Feb 12.

The Federal Reserve's decision on Wednesday to leave interest rates unchanged also supported bullion. The Fed kept the door open to a hike in June, but showed little sign it was in a hurry to tighten monetary policy.

"Investors' confidence is in jeopardy after the Bank of Japan's decision, and further fuel has been added by US corporate earnings," Ava Trade's chief market strategist Naeem Aslam said.

"The FOMC statement released earlier has not supported sentiment, and all these elements have added to one thing — risk-off trade. Hence we are experiencing this surge in the gold price. The next level of 1,300 is very much reality now."

Gold is highly sensitive to rising interest rates, which lift the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.

US data on Thursday supported views the Fed will take a cautious stance in hiking rates this year. US economic growth braked in the first quarter to its slowest pace in two years.

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