Forexpros – Gold futures traded higher in early U.S. trade Friday as expected weak U.S. economic numbers and euro zone fears triggered buying in the precious metal.
On the Comex division of the New York Mercantile Exchange, Gold futures for August delivery traded at USD1626.25 a troy ounce gaining 0.41% in early trade.
It traded at a session low USD1621.95 a troy ounce. Gold was likely to find support at USD1583.05 and resistance at USD1628.95.
Sparking the bullish gold sentiment, U.S. industrial production and the University of Michigan’s sentiment data, due later in the session, is expected to indicate a slowdown in the economy pressuring the greenback,
The UoM sentiment index is projected to decline to 77.5 from the previous reading of 79.3 when released later in the day,
Industrial production in the world’s largest economy likely slowed to 0.1% from 1.1% in April per a survey of economists,
In European Union news, Greece will vote on June 17th which will ultimately decide if the troubled nation remains in the euro zone,
However, central banks are preparing liquidity measures should the elections break down again.
Adding to the gold friendly environment, economic optimism weakened when Moody’s downgraded five Dutch banking groups. The rating agency named economic risk and fragile investor sentiment in Europe as reasons for the downgrade,
In other news, the Bank of Japan did not expand monetary stimulus resulting in a yen rally earlier.
Bank of England Governor Mervyn King stated that the bank may loosen monetary policy to support the economy.
The U.K.’s trade balance fell more-than-expected last month, official data showed on Friday.
In a report, National Statistics said that U.K. trade balance fell to a seasonally adjusted -10.1B, from -8.7B in the preceding month whose figure was revised down from -8.6B.
Analysts had expected U.K. trade balance to fall -8.5B last month.
US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, fell 0.06% to trade at USD82.13.
Elsewhere on the Comex, Silver for July delivery rose 1.03% to trade at USD28.700 a troy ounce while Copper for July delivery rose 0.70% to trade at USD3.378 a pound.