Home Market Gold prices crawl up as dollar pauses rally

Gold prices crawl up as dollar pauses rally

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BENGALURU: Gold prices edged up in early trade on Monday as the dollar took a breather after climbing to its highest level this year in the previous session.

FUNDAMENTALS

Spot gold rose 0.2 per cent to $1,316.62 per ounce at 0034 GMT.

US gold futures for June delivery were up 0.2 per cent at $1,317.20 per ounce.

The dollar index , which measures the greenback against a basket of six major currencies, was steady at 92.547 after hitting its best since December at 92.900 on Friday.

US job growth increased less than expected in April and the unemployment rate dropped to near a 17.5-year low of 3.9 per cent as some out-of-work Americans left the labor force.

Two Federal Reserve officials who are currently voting members of the US central bank's rate-setting committee said on Friday they were keeping an open mind on the total number of interest rate rises needed this year.

US interest rate futures rose modestly on Friday, as traders still expect the Federal Reserve to raise key borrowing costs at its June 12-13 policy meeting in the wake of weaker-than-forecast growth in domestic payrolls and wages in April.

Euro zone business growth dimmed again in April but the picture remained relatively bright as new business stayed buoyant and firms managed to build up backlogs of work, a survey showed on Friday.

SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, said its holdings fell 0.17 per cent to 864.13 tonnes on Friday from 865.60 tonnes on Thursday.

Hedge funds and money managers trimmed their net long positions in COMEX gold contracts in the week to May 1, US Commodity Futures Trading Commission (CFTC) data showed on Friday.

Demand for physical gold barely changed in major Asian hubs last week even as global prices weakened, while a correction in local rates in India prompted retail consumers and jewellers to start purchases.

The World Gold Council, owner of the world's largest gold-backed exchange traded fund (ETF), is launching a new fund with a cut-price management fee to fend off rivals with lower charges, a source familiar with the matter told Reuters.

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