Gold prices up for second day on Chinese data, weaker stock markets
Gold prices rose for a second session on Monday, as slowing economic growth in China and weakness in Asian stock markets lifted the safe haven appeal of the precious metal.
Spot gold gained 0.1 percent to $1,273.90 an ounce by 0042 GMT and U.S. gold futures added 0.2 percent to $1,275.50 an ounce. China’s investment, factory output and retail sales all grew more slowly than expected in April, adding to doubts about whether the world’s second-largest economy is stabilising, data released on Saturday showed. Gold has gained 20 percent this year after weak economic data in the United States and elsewhere eased expectations of a near-term increase in U.S. interest rates.
Higher rates would lift the opportunity cost of holding non-yielding gold. Still, stronger-than-expected U.S. economic data last week renewed expectations that the Federal Reserve will raise interest rates more than once this year, capping gains in precious metals.
U.S. retail sales in April recorded their biggest increase in an year as Americans stepped up purchases of automobiles and a range of other goods, suggesting the economy was regaining momentum after growth almost stalled in the first quarter.
Two Fed officials said the central bank should raise rates if data points to an improving economy. Spot silver advanced 0.2 percent to $17.13 an ounce, platinum was up 0.3 percent at $1,050.4 and palladium was rose 0.4 percent at $591.47.
Asian stocks slipped early on Monday, weighed down by Friday’s decline on Wall Street and soft Chinese economic data released over the weekend.