Gold Rebounds on US GDP Disappointment

“The Bank will continue with (QE) with a Negative Interest Rate”, aiming to achieve the price stability target of 2 percent, as long as it is necessary for maintaining that target in a stable manner”, the BOJ said in a statement. By coordinating its action with the government´s big fiscal spending package, the BOJ likely aimed to maximise the effect of its measures on the world´s third-biggest economy, which is struggling to escape decades of deflation. The dollar has fallen since the Federal Reserve’s statement from its policy meeting on Wednesday disappointed some investors who had thought the US central bank might signal that a rate increase was possible in September.

US gold for December delivery found its way up 1.4% to $1,359.30 U.S.an ounce.

U.S. Gross domestic product climbed by 1.2 percent in the second quarter following a downwardly revised 0.8 percent increase in the first quarter. Prices have now posted gains for six out of the seven months so far this year.

“A consensus seems to be emerging that the Fed will not raise rates until December at the earliest, and possibly not even then unless there is some improvement in the data”, George Milling-Stanley, head of gold investment strategy at State Street Global Advisors, told MarketWatch late Thursday. The yen jumped 3.05 percent against the dollar to 102.04 yen, the highest level since July 11. The WSJ Dollar Index, which measures the dollar against a basket of currencies, was recently down 1%. The buck was down 1.4% on the day and looking at a 2% weekly decline.

Ultralow rates around the world, and the prospect that interest rates may remain lower for an extended period, have weighed on the dollar and provided support for dollar-priced commodities, like gold. Based on the settlement of $1,320.60 for the most-active contract on June 30, prices saw monthly gain of 2.8%. It hit a 14-month high on Wednesday.

Silver was up 0.3 percent at $20.22 an ounce, and headed for a second monthly gain.

Copper for September delivery added 0.13 or 0.57% to 2.22 a pound. September palladium PAU6, +2.27% traded at $715.90 an ounce, up $17.25, or 2.5%, for the day, trading 19.8% higher on the month.