Gold price surges as Goldman Sachs casts doubt on U.S. rate rise
New York (Oct 7) Gold surged higher for a second day out of three as heavyweight broker Goldman Sachs became the latest commentator to cast doubt on a US rate rise this year.
Spot gold was US$13 higher at US$1,148 an ounce as the U.S. dollar retreated against a raft of its peer currencies.
Gold traditionally moves counter to the dollar and US bond yields, but both these have been falling since unexpectedly weak non-farm jobs number last Friday.
Goldman has still pencilled in a rise in December but added today that if recent softness in the UK economy continues, that decision may be postponed until well into 2016.
The rise has come despite Chinese markets being shut for the Golden Week holiday.
UBS added: "Evidence from the broader macro space is gradually piling up in gold's favour."
The missing piece according to the Swiss bank is physical demand.
"Lacklustre physical buying so far during this typically-strong period is disappointing investors," though it still sees time for it to pick up.
Demand from key physical markets in the weeks and months ahead will be important both in supply and demand terms and also on investors' sentiment, concludes UBS.