Gold marches higher on firm demand from top Asian cenbanks
Gold marches higher on firm demand from top Asian cenbanks

Gold marches higher on firm demand from top Asian cenbanks

GOLD prices rose on Monday to a record high for the seventh consecutive session, a move that analysts anticipate could be driven by strong demand from Asian central banks, despite traditional headwinds from a stronger U.S. dollar and elevated interest rates.

Spot gold was up 0.4% at $2,338.80 per ounce as of 1135 GMT, after hitting a record high of $2,353.79 earlier in the session. U.S. gold futures gained 0.6% to $2,358.40.

“Gold bulls may have taken their latest cues from the People’s Bank of China (PBOC), which extended its buying spree of the precious metal for a 17th straight month in March,” said Han Tan, chief market analyst at Exinity Group.

China held 72.74 million fine troy ounces of gold at the end of March, up from 72.58 million ounces at the end of February, official data showed on Sunday.

“With the PBOC as well as the Reserve Bank of India soaking up bullion to buffer their respective reserves, this massive buying spree by global central banks is certainly fuelling spot gold’s price surge.”

Bullion has risen more than 13% this year, despite headwinds from strong U.S. economic data, and bets that interest rate cuts could be delayed beyond June.

“There’re only two buyers in my book that would have that kind of attitude towards gold. One could be program buying by a central bank. The other alternative, impervious to market fundamentals, is option buying,” said independent analyst Ross Norman.

UBS raised its year-end target for bullion to $2,250 per ounce, in view of firmer demand and with a pick up in exchange-traded-fund (ETF) buying likely ahead.

London’s gold price benchmark hit an all-time high of $2,336.90 this morning, the London Bullion Market Association said.

Spot silver was up 0.9% to $27.73 per ounce, platinum climbed 1.4% higher to $940.30 and palladium rose 1.1% to $1,014.25. – Reuters

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