Gold futures are trading broadly higher in the Asia electronic trades today propelled by the weak nonfarm payrolls data released last week, which created a perception that the Federal Reserve may not rush to taper stimulus program. Meanwhile, hefty surge in the China gold consumption is also boosting the yellow metal.
China’s gold consumption jumped 41% in 2013 to exceed 1,000 tonnes for the first time, an industry body said on Monday. Gold consumption in China grew to 1,176.40 tonnes last year, with jewellery demand climbing 43% to 716.50 tonnes and bullion demand soaring 57% to 375.73 tonnes, the China Gold Association said on its website.
Data from the industry association also showed that China’s gold output in 2013 rose 6.2 percent from the previous year to a record high 428.163 tonnes, making the country the world’s biggest producer for a seventh straight year. China’s foreign exchange reserves, the world’s largest, rose to $3.82 trillion at the end of 2013.
An ounce of gold on the COMEX division of New York Mercantile Exchange is trading up $9.4 at $ 1272.3. Last week, it ended up 1.5% at $ 1262.90 per ounce.
The non-farm payrolls data showed that the US economy added 113,000 jobs in January, the Labor Department said Friday, falling well below expectation of 185,000 jobs. The pace of job growth over the past three months has slowed to 154,000. That’s down from average 194,000 monthly jobs added throughout 2013.
Data from the Commodities Futures Trading Commission released Friday showed that hedge funds and money managers reduced their bullish bets in gold futures in the week ending February 4. Net longs totaled 59,408 contracts, compared to 60,672 in the preceding week.
MCX April bullion futures are trading up more than Rs 200 at Rs 28984 per 10 grams. The counter may break and sustain above Rs 29000 levels in the near term.
In the week ahead, Fed Chair Janet Yellen is to testify on the central bank’s semiannual monetary policy report in Washington. Her comments will be closely watched.