Friday, 5 August 2016

Gold rises to 4-week highs, U.S. data in focus

Gold prices rose to four-week highs on Friday, as the Bank of England’s decision to lower interest rates continued to support and as investors eyed the release of key U.S. employment data due later in the day.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery were up 0.23% at $1,370.55.

Futures were likely to find support at $1,347.00, Thursday’s low and resistance at $1,374.90, the high from July 6.

International Market News

Gold prices moved higher after the Bank of England delivered its first rate cut in seven years on Thursday and announced more measures to stimulate the economy in a bid to ward off recession following Britain's vote in June to leave the European Union.

The BoE cut interest rates to a record-low 0.25% in a bid to buffer the economy from a downturn following the Brexit vote.

The central bank also boosted its quantitative easing program by £60 billion and slashed its growth forecast for next year. It now expects growth of just 0.8% in 2017, down from 2.3% in its May forecasts.


Almost all economists had expected the BoE to cut rates and many also expected it to resume its multi-billion-pound program of government bond purchases.

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