The price to buy gold fell hard on London's wholesale market at the start of trade Thursday, dipping near to a 2012 low beneath $1,634 per ounce as world stock markets and commodity prices also dropped.
Commodity prices are showing mixed results in European trade but S&P 500 index futures point firmly higher, hinting risk appetite is likely to be well-supported heading into the afternoon as Wall Street comes online.
The midweek sessions in precious metals started off at sharply lower price levels in the wake of the sentiment that took gold post the Fed announcement that given current economic conditions it has opted to do nothing more than monitor the situation.
Beginning in March, crude oil has a seasonal wind at its back. For nearly 30 years, the third month of the year has been the best month for crude oil. Over past cycles, WTI crude oil prices head higher in March, and have generally continued to climb through September.
Gold prices remained near three-month highs around $1,780 overnight and early this morning as a similarly-sounding achievement was also noted in its most recent tandem trading partner-the euro. The common currency hovered near ten-week highs above $1.34 despite an EU projection of a recession.
Copper shot higher yesterday after a deal on the second Greek bailout removed the uncertainty that prevented prices from fully capitalizing on a Chinese interest rate cut announced in the previous day.
Gold continues to track investors’ 2-3 year inflation expectations (tracked by “breakeven rates"). Prices put in their strongest performance in six sessions yesterday after minutes from January’s FOMC meeting showed some policymakers expected to introduce additional stimulus.