.png)
The Fed is likely to keep rates steady later on Wednesday, and the focus rests squarely on the tone of its statement and any timing for an eventual rate hike.
HSBC said a weaker U.S. dollar and hedging related to a U.K. referendum on leaving the European Union – often referred to as a Brexit -- are both bullish for gold.
HSBC believes this asymmetric relationship also applies to gold. The bank continues to see the potential for gold to reach $1,300 an ounce this year. As well as a weaker USD, HSBC sees global risks and a modest recovery in oil prices as gold-bullish.
Gold prices that hit a 13-month high last month are likely to fall back in the short term because of a slump in demand from key Asian consumers, GFMS analysts at Thomson Reuters said in a report on Tuesday.
Global gold demand tumbled by 24 percent year on year to 781 tonnes in the first three months of the year, its weakest quarter in seven years, GFMS said.
Gold started 2016 on a bullish note but physical demand plummeted in the first quarter, especially in Asia led by India and China. Physical demand for gold tumbled 24% to just 781 tonnes in the first three months of this year, lowest quarterly total since the first quarter of 2009, according to Thomson Reuters GFMS survey.
While physical demand was weak across all sectors and many countries it was striking that the traditional powerhouses of India and China saw plummeting demand, partly due to higher prices but crucially hindered in the case of the former by the budget and ensuing jewellers’ strike, as per the survey.
Reference: Reuters, Commodity Online, Kitco
Thai
Eng