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European stocks rebound
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Overall trend for gold remains positive - analyst
(Adds details and updates prices)
By Ashitha Shivaprasad
March 27 (Reuters) - Gold prices slipped on Monday as a
rebound in equities dented the metal's safe-haven appeal, while
investors evaluated steps taken by authorities to calm fears of
a crisis in the global banking system.
Spot gold was down 1.4% at $1,949.99 per ounce as of
1219 GMT. U.S. gold futures fell 1.5% to $1,954.20.
A buyer for Silicon Valley Bank's deposits and loans helped
shares in European lenders mount a partial recovery, sending
gold further below the $2,000 mark breached last week. "After kissing the psychological $2,000 level last week,
bears exploited this resistance to attack. Appetite for the
precious metal has also been dampened by a stabilising dollar
and mixed signals on monetary policy from the Fed," said Lukman
Otunuga, senior research analyst at FXTM. Recent stress in the banking sector and the possibility of a
follow-on credit crunch bring the U.S. closer to recession,
Minneapolis Fed president Neel Kashkari said on Sunday. However,
U.S. Federal Reserve officials said there was no indication that
financial stress was worsening.
"Gold is set to shine through the market chaos with
expectations around the Fed cutting rates in 2023, fuelling
upside gains," Otunuga said, adding that a potent fundamental
spark is needed to conquer the $2,000 psychological level and
the March 2022 peak to hit a record high.
Last week, the Fed indicated it was on the verge of pausing
further increases in borrowing costs, boosting non-yielding
gold's appeal.
The minor decline (in gold prices) on Monday can be
attributed to the recovery seen in stocks, but the overall trend
for gold remains positive, Carlo Alberto De Casa, external
analyst at Kinesis Money said.
On the physical front, China's February net gold imports via
Hong Kong nearly tripled from the previous month.
Spot silver fell 1.2% to $22.96 per ounce, platinum lost 1.1% to $965.94 and palladium rose 0.3% to
$1,420.44.
(Reporting by Ashitha Shivaprasad in Bengaluru; Editing by
Sonia Cheema, Shounak Dasgupta and Krishna Chandra Eluri)
