Gold futures likely to trade sideways again next week

Singapore (April 14)  Gold futures contract on Bursa Malaysia Derivatives is likely to trade sideways next week, as currency traders will be closely monitoring the release of a series of economic data by the United States and China during the period.

 A dealer said should the US economic indicators, namely the US Initial Jobless Claims and the US Markit Purchasing Managers' Index Manufacturing, released next week surprise on the upside, that might put pressure on Asian currencies.

 "That would be a boon for gold, which has traditionally been used as a safe-haven asset," he told Bernama.

 However, the dealer said, next week would also see China releasing its first quarter gross domestic product data as well as March's industrial production and retail sales data.

 "If the statistics show signs of stabilisation, that could ease concerns surrounding global growth and boost the risk-on appetite among investors," he said, adding that this could have a negative impact on gold.

 For the week just ended, the gold futures market was also traded sideways, mainly influenced by the progress of the US-China trade discussions, the downgrade of global growth forecast by the International Monetary Fund, as well as the disappointing February 2019 Industrial Production Index data.

 On a Friday-to-Friday basis, April 2019 jumped 40 ticks to RM171.50 a gramme, while May 2019, June 2019 and July 2019 were 36 ticks higher each at RM171.50, RM171.40 and RM171.50 a gramme, respectively.

 Weekly turnover widened to 13 lots worth RM222,480 from one lot worth RM17,000 in the previous week, with open interest increasing to 34 contracts from 21 contracts previously.