(MENAFN- ProactiveInvestors) Gold recovered from the two-week low of $1250 per troy ounce and was heading for its best monthly gain for almost a year.
The spot price fell 2% yesterday as the US Federal Reserve reminded the market that whatever is happening in Europe US interest rates are still going to go up.
Commerzbank cautioned today that there may be more short-term weakness ahead as futures investors had built up net long positions in gold recently.
Balancing that however has been a resurgence of buying through exchange traded funds (ETFs).
ETFs saw an inflow of 7.1 tons yesterday much of which went into SPDR Gold Trust the largest of the gold-backed funds.
Since the start of 2015 some 65 tons has flowed back the gold-backed ETFs noted Commerzbank the highest monthly inflow since September 2012.
SPDR Gold Trust meanwhile saw its holding rise by 50 tons the highest monthly inflow since November 2011.
“The U-turn made by ETF investors is one of the most remarkable developments on the gold market this year and one key reason for the price rise since the start of the year” said the German bank.
Ahead of the start of trading on Wall Street spot gold was US$6 higher at US$1263 with a lower than expected US GDP number providing some impetus.
Growth was still a handy 2.6% in the final quarter of 2014 but forecasts had been for over 3% with business investment the reason for the miss. Over the whole year the US economy grew by 2.4%.
Spot gold was US$1262 ahead of Wall Street's open Friday. Silver and platinum were flat at US$16.91 and US$1218 respectively.
Major movers
up 165p at 5585p
up 31p at 894p
up 19p at 1116p
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