• Sunday, May 19, 2024
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BusinessDay

Gold rises; physical buyers emerge from lows

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Gold rose on Wednesday after a slide to two-year lows this week attracted Asian interest in buying the physical metal, but sentiment was still severely shaken by the biggest two-day loss in 30 years, according to Reuters report yesterday. Investors continued to exit gold-backed exchange-traded funds, concerned that the metal has lost its shine as a safe haven and inflation hedge.

Gold rose 0.7 percent to $1,383.15 an ounce by 0755 EDT (1155 GMT), having tumbled to its lowest since January 2011 at $1,321.35 on Tuesday. The market fell by a combined $225 on Friday and Monday, which compares with a total trading range of $260 in 2012.

It is down about 18 percent so far this year after 12 years of gains.

“We bounced a little bit in the past two sessions, and I suspect there was quite good buying coming out of Asia from places like China and potentially India,” Natixis analyst Nic Brown said.

“I think that at this point a new range will be established. We can’t go back to the old $1,500-$1,580 range because investor sentiment has fallen, but it still early days to understand at which levels people will feel they can sell again.”