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Gold up in Asia as China to report GDP, industrial output , retail sales

CommoditiesJul 16, 2017 08:33PM ET
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© Reuters. Gold gains in Asia

Investing.com - Gold gained on Monday in Asia ahead of China second quarter GDP and industrial output and retail sales figures fro June with industrial metal demand for housing and property development also in focus.

Gold futures for August delivery rose 0.25% to $1,230.56 on the Comex division of the New York Mercantile Exchange. Copper future on the Comex gained 0.19% to $2.689 a pound.

China released second quarter GDP growth with a gain of 1.7% that matched expectations and a year-on-year increase of 6.9% that came in slighltly higher than the expected 6.8%. At the same time, China reported industrial production gained 7.6% from a year earlier in June and retail sales rose 11% in June. AUD/USD traded at 0.7823, down 0.09% with China a top trading partner for energy, metal and food commodities, while USD/JPY changed hands at 112.44, down 0.09% as well.

On Thursday the European Central Bank meeting will provide fresh clues on when the central bank will shift away from its ultra-easy policy. Markets in Japan are shut on Monday for a holiday.

Last week, gold prices rose to two-week highs on Friday as weak U.S. inflation data added to doubts over whether the Federal Reserve would raise interest rates for a third time this year.

The precious metal ended the week with gains of 1.32%.

U.S. consumer price inflation slowed to 1.6% in June from 1.9% in May, the Labor Department said on Friday.

Consumer spending was also weaker than expected, with retail sales falling 0.2% in June, compared to expectations of a 0.1% rise. The Fed hiked rates at its June meeting and stuck to its forecast for one more rate hike this year but the sluggish inflation outlook has raised questions over whether officials will be able to stick to their planned tightening path.

In testimony before Congress on Wednesday, Fed Chair Janet Yellen said the economy is on a strong enough footing for the Fed to raise rates, but she also reiterated that inflation is below target and noted that it is a particular “uncertainty” that could affect monetary policy.

Expectations that rates will stay low tend to boost gold, which struggles to compete with yield-bearing investments when borrowing costs rise.

Gold up in Asia as China to report GDP, industrial output , retail sales
 

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