Gold hits 13-month top on firm euro

MANILA: Gold climbed to a 13-month high on Friday, buoyed by gains in the euro after the European Central Bank (ECB) signalled it was done cutting interest rates for now.

The ECB on Thursday rolled out measures, including an expansion in asset buying and a deeper cut to deposit rates.

But the euro hit a three-week top, and held near that level on Friday, after ECB President Mario Draghi signalled there would be no further rate cuts.

Spot gold rose as far as $1,282.51 an ounce, its strongest since Feb. 3, 2015, and was trading at $1,277.20 by 0237 GMT, up 0.5 percent.

Bullion climbed 1.5 percent on Thursday, its biggest single-day gain in a week, and was on course for a second weekly rise.

For the year, gold has added more than 20 percent.

US gold for April delivery climbed 0.4 percent to $1,277.60 an ounce, after peaking at $1,287.80.The next major resistance level for gold would be around $1,308, reached in January last year, said Ric Spooner, chief market analyst at CMC Markets in Sydney.

“Ultimately if this trend continues, we may well see ourselves up towards $1,400 in gold,” he said.

The relatively weak US dollar, despite expectations that the US Federal Reserve could raise interest rates this year, as well as concerns about a wobbly global economy should support gold prices going forward, said Spooner.

“Gold remains our preferred commodity/sector in view of increasing liquidity from global monetary easing,” Argonaut Securities analyst Helen Lau wrote in a research note.

Holdings of SPDR Gold Trust, the world´s largest gold-backed exchange-traded fund, rose to 25.68 million ounces on Thursday, the highest since August 2014.With the metal clinging to this year´s gains, physical gold demand slowed in top consumer China this week, while a strike by jewellers protesting against the imposition of a tax curbed demand in No.2 market India.

Spot silver gained 0.4 percent to $15.65 an ounce, platinum advanced 0.8 percent to $983.35 and palladium was steady at $570.

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