Gold futures rose for the first time in three days as China took steps to shore up economic growth amid signs of a deepening slowdown, boosting demand for the metal as a store of value.
China reduced the amount of cash lenders must set aside as reserves in a bid to increase liquidity, following capital outflows and weaker manufacturing. Gold pared earlier gains of as much as 1 percent after a report showed U.S. service industries expanded at a faster pace last month.
The metal in January jumped the most in three years as concern mounted that Greece would exit the euro area and officials in Europe and Asia announced stimulus to bolster stagnating economies. Imports by India, the world™s second-biggest user, surged in the 10 months ended Jan 31 after the government eased curbs on purchases.
On the Comex in New York. gold futures for April delivery rose 0.3 percent to settle at $1,264.50 an ounce at 1:51 p.m. Aggregate trading was 25 percent below the 100-day average, according to data compiled by Bloomberg. The price fell 1.5 percent in the previous two days on concern that U.S. interest rates will increase soon.
Last year, gold posted a consecutive annual decline for the first time since 1998 as the U.S. economy gained traction and equities surged to a record.
Source : Bloomberg