(Reuters) – On Thursday, gold hit its highest in three weeks, mainly on uncertainty about the Feds timing of slowing their bond purchases pace. The USD is still under pressure, and SPDR gold ETFs holdings rose.
Gold price fell to $1,329 per ounce, making an 0.56% loss. Gold rose to touch a high of $1,344.89 at 0213 GMT. London AM gold fix was $1,339.50 while the PM fix is at $1,329.75.
The USD fell by 0.2% against a basket of currencies on Fed president of St. Louis, James Bullard, saying that curbing the quantitative easing program next month might be too soon.
Traders and investors were encouraged to invest in the yellow metal and push the prices up for six sessions. Macquarie analyst, Matt turner, said the market is testing the sustainability of these recent gains.
SPDR Gold Trust holdings, the largest gold-backed ETF, rose for the first time since June to 913.23 tonnes.
Physical demand on gold picked up with the recent stabilization in prices. However, central banks purchases and gold ETFs outflow reduced the total demand on gold by 12%.
Demand from India and China might reach 1,000 tonnes each this year, according to the World Gold Council. The world largest gold consumer, India, is the largest country importing gold. China, the world biggest gold producer, might surpass India’s gold imports this year.
Wedding and festival season in the second half is demand season in India. Till now, the world largest gold consumer account for nearly 60% of global demand. The Indian government was trying to keep gold imports below 850 tonnes this year. However, the demand for gold estimated between 900 tonnes and 1,000 tonnes for 2013.
Chinese gold demand for the first half has already reached 600 tonnes, while India’s demand reached 566 tonnes with a 50% jump.