Gold futures rebounded after a gauge of manufacturing in New York state unexpectedly declined, boosting the precious metal’s appeal as a haven.
A surprise negative reading for the New York Federal Reserve Bank’s index added to recent signs of uneven U.S. expansion and eased concerns that the economy is strong enough for policy makers to start raising interest rates. The metal fell 2.5 percent last month on speculation that rates would climb, damping gold’s appeal because the commodity generally only offers returns through price gains.
Prices were little changed last quarter as investors weighed the outlook for monetary tightening in the U.S. against increased global stimulus. European Central Bank President Mario Draghi said Wednesday his 1.1-trillion-euro ($1.2 trillion) quantitative-easing program started in March will help to boost sagging inflation. The metal has historically been used as a hedge against higher consumer costs.
Gold futures for June delivery rose 0.7 percent to settle at $1,201.30 an ounce at 1:41 p.m. on the Comex in New York. On Tuesday, the price touched $1,183.50, the lowest for a most-active contract since April 1.