Gold futures eke out third gain in a row, but spot cash price was lower
San Francisco (Mar 16) Gold futures settled higher on Monday for a third session in a row, as weakness in the U.S. dollar helped lift the metal’s investment appeal, but pressure from a rally in the stock market kept a lid on gold’s gains.
The market is likely to get its next real cue from the results of the Federal Open Market Committee's closely watched meeting and policy statement set for Wednesday.
Gold for April delivery GCJ5, +0.05% tacked on 80 cents, or 0.1%, to settle at $1,153.20 an ounce on Comex. May silver SIK5, +0.62% fared better, up 12.3 cents, or 0.8%, to $15.617 an ounce.
Gold futures had tapped an intraday high above $1,163, but pulled back as U.S. equities rose, led by strong gains for Europe and in Asia, where the Shanghai Composite Index SHCOMP, +2.26% surged to its highest settlement in 5 1/2 years after Chinese premier Li Keqiang said that the government will step up efforts to bolster economic growth.
US:GCJ5 -- $1,150$1,200$1,250$1,300$1,100$1,350
Last week, gold failed to overcome a U.S. dollar DXY, -0.55% that was racing toward parity against the euro EURUSD, +0.84% even as some lackluster economic data provided some support for gold prices. After gold tallied a loss of 1% last week, weakness in the dollar helped provide a boost to the metal on Monday.
This week, the Fed takes center stage on Wednesday with investors watching for whether the word “patient” is removed in the statement. If it is left in the central bank’s policy statement, gold could remain under pressure. Conversely, if it is removed, equities could get beaten up a bit, while gold works its way higher.
“Analysts, pundits and ‘close sources’ all say the Fed will kill ‘patience’ when it meets on Wednesday this week — or at least make her disappear from public view,” said Adrian Ash, head of research at BullionVault, in a note Monday.
“That mere idea of the Fed losing patience, and paving the way to a rate-hike in June, is being blamed for last week’s slump in U.S. stock markets,” Ash added.
Elsewhere in metals trading, April platinum PLJ5, -0.69% eased by $7.30 to $1,107.90 an ounce, while June palladium PAM5, -0.75% shed $8.60 to $780.10 an ounce.