Gold traders turn bullish
During the past week, following a volatile period in the last week of September, spot gold traded in a relatively subdued manner. Prices opened very close to its weekly low ($1645), as the prices moved sideways during the rest of the week. The price reached a weekly high of $1691.3 on Wednesday, before ending lower on Thursday.
An unexpected decrease in Chinese exports reintroduced the fears of a global economic slowdown, as the bullion and U.S. equity markets fell in tandem. Despite having an inverse relationship, the yellow metal in recent weeks has moved in sync with riskier assets, in contrast to its historical views of being a safe haven asset.
Gold also faced pressures from the rising USD as claims for jobless benefits edged down marginally and the goods trade deficit remained unchanged at $45.6 billion, both indicating a modest improvement in the economy.
However, gold prices are being buoyed by strong demand from Asian markets as festival season approaches.
Following a 0.6% slide on Thursday, gold prices were trading in the positive on Friday as market players turn bullish after the biggest slump in three years. Central banks may be encouraged also to increase their holdings for reserves in the coming months and possibly push the price up.