Gold holds near $1,280 amid shaky global outlook

epic_research

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Gold steadied near $1,280 an ounce on Monday, after posting its biggest monthly gain in three years, as a shaky outlook for the global economy preserved bullion’s safe-haven draw.

Weekend data showed China’s factory sector shrinking in January for the first time since 2012. This report came shortly after Friday’s US gross domestic product number that marked a sharp slowdown in the fourth quarter.

Spot gold was off 0.3 per cent at $1,279.18 an ounce by 0240 GMT after rising 2 percent on Friday. It ended January with a gain of 8.4 per cent, its largest monthly increase since January 2012.

US economic growth slowed to a 2.6 percent annual pace from a 5 percent rate in the third quarter as weak business spending and a wider trade deficit offset the fastest pace of consumer spending since 2006.

China’s factory sector unexpectedly shrank for the first time in nearly 2-1/2 years in January and firms see more gloom ahead, raising expectations that policymakers will take more action to forestall a sharper slowdown.

Gold’s firm tone is also backed by strong inflows into exchange-traded funds.

Holdings at SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, stood at 24.4 million ounces as of Thursday, the highest since mid-October.
 
 
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