© Reuters. Gold prices gain in early Asia Investing.com - Gold prices were higher in early Asia on Monday as markets looked ahead to rema...
© Reuters. Gold prices gain in early Asia
Investing.com - Gold prices were higher in early Asia on Monday as markets looked ahead to remarks by a key Federal Reserve policymaker.
Gold for December delivery on the Comex division of the New York Mercantile Exchange was up 0.15% to $1.161.30 a troy ounce.
Also on the Comex, silver futures for September delivery rose 0.16% to $15.325 a troy ounce by close of trade. Prices rallied to $15.71 earlier in the day, the most since July 13.
Elsewhere in metals trading, copper for September delivery dropped 0.37% to $2.288 a pound.
Last week, copper prices slumped 4.1 cents, or 2.04%, as concerns over the health of China's economy and steep declines on Chinese stock markets dampened appetite for the red metal.
The preliminary reading of the Caixin/Markit manufacturing purchasing managers’ index published on Friday fell to 47.1 in August from a final reading of 47.8 a month earlier. It was the lowest reading since March 2009.
The gloomy figure added to concerns over the health of the world's second largest economy.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Ahead on Monday, Federal Reserve Bank of Atlanta President Dennis Lockhart is to speak; his comments will be closely watched.
Last week, gold futures rallied to a more than six-week high on Friday, as steep losses in global equity markets and receding expectations that the Federal Reserve will raise U.S. interest rates next month boosted demand for the yellow metal.
The Shanghai Composite tumbled more than 4% on Friday, Germany's DAX crashed almost 3%, while the Dow and S&P 500 suffered their worst day since 2011, as fears of a China-led global economic slowdown spooked traders and rattled sentiment.
Gold fell to a five-and-a-half year low of $1,072.30 on July 24 amid speculation the Fed will raise interest rates in September for the first time since 2006. But prices have since rebounded almost 9% on hopes of a delayed U.S. rate hike.
Some traders believe the U.S. central bank could postpone raising interest rates until December, as officials are likely to remain concerned over weak global growth and inflation pressures due to China’s shock currency devaluation move and plunging oil prices.
A delay in raising interest rates would be seen as bullish for gold, as it decreases the relative cost of holding on to the metal, which doesn't offer investors any similar guaranteed payout.
Dollar weakness usually benefits gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies.
The greenback sold off sharply this week as concerns over the health of the global economy fanned hopes that the central bank could delay raising interest rates till the very end of 2015.
In the week ahead, investors will be looking ahead to Wednesday’s data on U.S. durable goods orders for a fresh reading on the strength of the economy. A speech on Monday by Atlanta Fed President Dennis Lockhart will also be closely watched.