Gold was steady in the face of more gains for equities ahead of Friday’s meeting of central bankers at Jackson Hole, Wyoming.
Federal Reserve chair Janet Yellen will be a key speaker and any indication a US rate rise is coming would likely be bad for gold as the metal traditionally moves counter to interest movements.
Canadian broker TD Securities suggested, however, that even with a more aggressive US attitude gold may be able to hold firm above US$1,300.
“While we do think that Janet Yellen may point the Fed in a more hawkish direction on Friday, there is likely to be continued ambiguity surrounding future US monetary policy,” it said in a note today.
“This, in combination with the fact that some $13 trillion worth of fixed-income assets are yielding negative rates, should impact interest rates only modestly and neither the opportunity cost to hold the yellow metal or the carry costs should rise too much.”
The amount of gold held in exchange traded funds has also risen over the past two days, noted Commerzbank, with large amounts again being shipped from Switzerland to the UK where a number of funds store their gold.
Switzerland is the centre for a lot of refining and as well as to the UK July, exports to China were twice as high as this time last year at 55 tonnes.
Demand from India however remained uncharacteristically subdued.
Spot gold traded US$3 higher at US$1,342. Silver added a few cents to US$18.97, while platinum gained US$6 to US$1,107.