BENGALURU • Gold prices rebounded yesterday from a near four-month trough hit in the previous session as investors resumed trading after the Easter holiday, with bullion gaining further traction on higher crude rates.
Spot gold was up 0.4 per cent at US$1,279.48 per ounce as of 3.25am GMT, having touched US$1,270.63 in the previous session - its lowest since Dec 27 last year.
The metal dropped 1.2 per cent in the previous week, marking a fourth consecutive weekly decline.
US gold futures were 0.5 per cent higher at US$1,281.70 an ounce.
"Gold prices last week have suffered from a very sharp decline; for now what is happening is just technical buying, with some people coming and pushing prices up," said analyst Benjamin Lu of Phillip Futures.
Also adding to the metal's gain was a rally in oil prices due to mounting tensions between the United States and Iran, with the former expected to announce a blanket ban of Iranian oil imports worldwide.
"Gold has climbed slightly... benefiting from higher oil prices driven by geopolitical tensions. With regional equity markets possibly coming under pressure today as a result, gold could be a principal beneficiary in today's session," Mr Jeffrey Halley, a senior market analyst with Oanda, said in a note.
However, capping gains for the metal was an upbeat dollar, which rose against the British pound after data showed that US economic growth might have picked up in the first quarter.
Gold prices last week have suffered from a very sharp decline; for now what is happening is just technical buying, with some people coming and pushing prices up.
MR BENJAMIN LU, an analyst at Phillip Futures.
US retail sales increased the most in 11/2 years last month, the latest indication that economic growth picked up in the first quarter after a false start, data showed last Thursday.
Gold is positively correlated to oil as the metal is often seen as a hedge against oil-led inflation, while a stronger greenback makes dollar-denominated gold more expensive for holders of other currencies.
Meanwhile, investors continue to cut their exposure to gold. Speculators switched to a net short position in Comex gold in the week to April 16, the US Commodity Futures Trading Commission said last Friday.
Also, holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, dropped to 751.68 tonnes last Thursday, the lowest levels seen since Oct 26.
Elsewhere, silver rose by nearly 1 per cent to US$15.07 an ounce. Platinum gained 0.5 per cent to US$905.40. Earlier in the session, the metal hit its highest level in over a week at US$906.80.
Palladium was steady at US$1,422.19, having earlier climbed to its highest level in over two weeks at US$1,424.50.