Gold Prices Unable To Holding Gains Following Optimistic Comments On Eurozone Growth
Editor's Note: The article was updated to reflect a drop in prices.
(Kitco News) -The gold market is unable to hold gains as the euro drops gains against the U.S. dollar following optimistic comments from European Central Bank president Mario Draghi.
The ECB remains confident that the eurozone economy will continue to trend upwards through the rest of the year despite a recent wave of lackluster growth, an environment of rising inflation.
The euro briefly pushed to session highs against the U.S. dollar Thursday after Draghi described the sentiment among the governing committee regarding economic growth as “cautious tempered with unchanged confidence.”
As the euro has rallied, gold prices has held firmly in positive territory, as it remains near the bottom of its well-established trading range. However, the market was unable to hold its gains and it dropped into negative territory; June gold futures last traded at $1,321.50 an ounce, down 0.10% on the day.
“The latest economic indicators suggest some moderation in the pace of growth since the start of the year. This moderation may in part reflect a pullback from the high pace of growth observed at the end of last year, while temporary factors may also be at work,” Draghi said in his opening statement. “Overall, however, growth is expected to remain solid and broad-based. Our monetary policy measures, which have facilitated the deleveraging process, should continue to underpin domestic demand.”
Overall, he said that the risks to continued economic growth remain broadly balanced. Draghi also warned that a significant risk to the region’s economy is the rising threat of protectionism.