Gold prices edged slightly lower on Thursday after rising to a fresh all-time high above $2,300 an ounce on Wednesday.
Prices drifted as low as $2,283 an ounce before partly recouping the losses to trade at around $2,290 an ounce by Thursday afternoon. That compared with a fresh all-time high of $2,313 an ounce on Wednesday.
The modest pull-back highlighted a more subdued mood in the market, compared with the sharp volatility seen as prices rallied in the first half of the week.
US initial jobless claims figures for the week ending March 30 came in at 221,000, according to figures released Thursday, well above market expectations of 214,000. A higher number of people seeking government support makes a stronger case for central banks to lower interest rates to stimulate growth, which in turn would be bullish for non-yield-bearing assets like gold.
Nevertheless, gold’s refusal to push higher on Thursday shows some caution in the market after the hefty gains seen earlier in the week.
The latest rally to an all-time high may lead some participants to take the view that gold is now in overbought territory, especially as the steepness of the recent rally may be hard to sustain. The focus will now be on whether the $2,300 mark will stand as a resistance level.
Looking ahead, the markets will be watching out for the US Non-Farm Payrolls figures for March due out on Friday, which should help shed further light on the state of the economy.
Frank’s experience covering the commodities markets spans 22 years, with a particular specialism in metals, carbon and energy markets. He has worked as a senior editor for S&P Global Commodity Insights (formerly Platts) and before this, at ICIS-LOR, a part of Reed Business Information (Reed Elsevier), where he covered the petrochemicals markets from 2003 to 2005.
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