Investing.com - Gold futures traded sharply higher Friday as worldwide commodity optimism gripped investors as a result of European Union summit progress on the debt crisis.
On the Comex division of the New York Mercantile Exchange, Gold futures for August delivery traded at USD1581.45 a troy ounce surging 2.00%.
Gold was likely to find support at USD1548.45 and resistance at USD1588.95.
Commodity sentiment found support after euro zone leaders agreed at a summit in Brussels that the region's rescue funds could be used to stabilise bond markets without forcing countries that comply with European Union budget rules to adopt extra austerity measures or economic reforms.
The leaders also agreed that the bloc's future permanent bailout fund, the European Stability Mechanism (ESM), would be able to lend directly to recapitalize banks without increasing a country's budget deficit.
Spain’s 10 year bond yield plunged 39 basis points to 6.56%, while Italy’s 10 year yield dropped 42 basis points to 5.78% on the news from the summit.
Adding to the bullish fervor, central banks are buying bullion with Russia, Ukraine, Turkey and Kazakstan expanding reserves by a combined 25 tons in May, according to the International Monetary Fund.
On a bearish note, the Reserve Bank of India may cut gold coin sales by banks and Indian imports may drop to 20 tons from 25 tons this month, down from 55 to 60 tons a year ago.
On Thursday, Morgan Stanley slashed its 2012 gold price forecast by 8.1% to USD1677 per troy ounce.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, fell 0.91% to trade at USD82.15.
Elsewhere on the Comex, Silver for September delivery jumped 3.30% to trade at USD27.158 a troy ounce while Copper for September delivery rose 2.69% to trade at USD3.421 a pound.
On the Comex division of the New York Mercantile Exchange, Gold futures for August delivery traded at USD1581.45 a troy ounce surging 2.00%.
Gold was likely to find support at USD1548.45 and resistance at USD1588.95.
Commodity sentiment found support after euro zone leaders agreed at a summit in Brussels that the region's rescue funds could be used to stabilise bond markets without forcing countries that comply with European Union budget rules to adopt extra austerity measures or economic reforms.
The leaders also agreed that the bloc's future permanent bailout fund, the European Stability Mechanism (ESM), would be able to lend directly to recapitalize banks without increasing a country's budget deficit.
Spain’s 10 year bond yield plunged 39 basis points to 6.56%, while Italy’s 10 year yield dropped 42 basis points to 5.78% on the news from the summit.
Adding to the bullish fervor, central banks are buying bullion with Russia, Ukraine, Turkey and Kazakstan expanding reserves by a combined 25 tons in May, according to the International Monetary Fund.
On a bearish note, the Reserve Bank of India may cut gold coin sales by banks and Indian imports may drop to 20 tons from 25 tons this month, down from 55 to 60 tons a year ago.
On Thursday, Morgan Stanley slashed its 2012 gold price forecast by 8.1% to USD1677 per troy ounce.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, fell 0.91% to trade at USD82.15.
Elsewhere on the Comex, Silver for September delivery jumped 3.30% to trade at USD27.158 a troy ounce while Copper for September delivery rose 2.69% to trade at USD3.421 a pound.