By Usman Ahmed
ISLAMABAD: Gold prices nosedived
to $1358.356 level on Friday, for a seventh consecutive day in a worst fall
since March 2009 amid speculation that US Federal Reserve is mulling over to
end its Quantitative Easing (QE) program which was started in 2008.
On the Comex division of the New
York Mercantile Exchange, gold futures for June delivery were down 1.86% at
$1,361.05 a troy ounce in US trading on Friday, up from a session low of
$1,357.85 and down from a high of $1,391.25 a troy ounce.
Gold futures were likely to test
support $1,347.50 a troy ounce, the low from April 18, and resistance at
$1,444.15, Tuesday’s high.
Gold has lost nearly six percent
of its value in the six sessions through Thursday. The metal is down 17 percent
for the year and is on track for its worst weekly decline in a month. Holdings
in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell
to their lowest in four years.
The bearish trend is likely to
continue next week as a number of Federal Reserve officials have confirmed that
the central bank is seriously considering end its aggressive bonds buying
policy, commonly known as QE.
San Francisco Federal Reserve President John Williams said on Thursday that the central bank could begin easing up on the monetary gas pedal this summer and end its bond buys late this year if the job market improves.
Earlier Thursday morning,
Philadelphia Fed President Charles Plosser said the central bank should reduce
asset purchases starting next month.
Seventeen analysts surveyed by
Bloomberg expect prices to fall next week, with eight bullish and three
neutral, the highest proportion of bears in two weeks. The analysts were
divided a week ago after gold rebounded as much as 13 percent from the two-year
low of $1,321.95 an ounce on April 16.
In Pakistan, gold prices have
slid down to PKR 52,500 per Tola and PKR
45,000 per 10 grams.
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