A weaker U.S. dollar on Thursday placed the gold on the positive territory; expectations that major banks in Europe are ready to tighten their monetary policy also supports. However the rise of equities on the stateside made the gains of the bullion limited.
Edward Meir, Stone analysts at INTL FC said that in spite of the headwinds being created by a weaker greenback, more significant gains in the bullion were held on account of the idea that the stock market in the United States performed well on Wednesday. He added that they are assuming the possibilities that gold will slightly jump on account of the U.S. dollar’s sluggishness, even though heightened rate and firmer U.S. equities must cap a stronger move.
Looking on metal prices, U.S. gold futures edged up more than 0.2 percent to trade at $1,251.80 an ounce and spot gold as well was 0.2 percent higher to settle at $1,251.87 an ounce.
Bank of England (BOE) governor Mark Carney along with the non-dovish remarks from European Central Bank (ECB) President Mario Draghi have made investors to widely expect that a scale back in monetary stimulus in Europe will happen. Draghi earlier signalled that the bank would cut its stimulus this 2017, but according to some sources he originally planned to indicate acceptance for poor inflation period, instead of a brief normalization of monetary policy.
The U.S. dollar index declined to its poorest level since October on the same day at 95.754 versus its major opposing currencies. It is already given that a much stronger U.S. dollar is not good with gold because it makes the non-yielding bullion high-priced for non-U.S. holders which will further reduce the demand.