Gold Price aces headwinds from strong China factory data

Beijing (Mar 31) - Gold prices inched lower on Wednesday as data showing a faster-than-expected growth in China's factory
activity weighed on the metal's safe-haven appeal, while a surge in U.S. Treasury yields added further pressure.
   
FUNDAMENTALS
    * Spot gold was down 0.1% to $1,683.56 per ounce by
0129 GMT. U.S. gold futures were flat at $1,685.10 per
ounce.
    * China's factory activity expanded at a
faster-than-expected pace in March, official data showed, as
factories that had closed for the Lunar New Year holiday resumed
production to meet improving demand.            
    * The U.S. 10-year Treasury yield rose as far as
1.776% on Tuesday, its highest since Jan. 22.     
    * Higher returns on bonds increase the opportunity cost of
holding non-yielding bullion.
    * U.S. consumer confidence surged in March to its highest
level since the start of the COVID-19 pandemic, supporting views
that economic growth will accelerate in the coming
months.           
    * Federal Reserve policymakers are optimistic about the U.S.
economic outlook as more Americans are vaccinated and government
aid gets to households and businesses, and they are not going to
stand in its way.            
    * The International Monetary Fund will raise its forecast
for global economic growth in 2021 and 2022 after last year's
3.5% contraction, IMF Managing Director Kristalina Georgieva
said on Tuesday.            
    * SPDR Gold Trust, the world's largest gold-backed
exchange-traded fund, said its holdings rose 0.1% to 1,037.50
tonnes on Monday from 1,036.62 tonnes on Friday.         
    * Silver was steady at $24.01, while platinum      
rose 0.5% to $1,160.05 and palladium        was up 0.7% at
$2,607.04.
 

Reuters