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Gold futures on Thursday were little changed, but tilted higher, as investors in metals cued in on the European Central Bank, which held its policy unchanged, as expected.
The European Central Bank left its policy unchanged at minus 0.5% and its refinancing rate at 0%, while reaffirming it plans to leave rates at present or lower levels until inflation rises to converge with its target at 2%. The focus for now will likely be on ECB President Christine Lagarde’s news conference, at 8:30 a.m. Eastern.
December gold GCZ20, +0.47% GC00, +0.47% was up $4.30, or 0.2%, at $1,959.40 an ounce, but swinging between small gains and losses in the early session, following a 0.6% rise for the yellow metal on Wednesday.
December silver SIZ20, +1.79% SI00, +1.79%, meanwhile, traded 24 cents, or 0.9%, at $27.32 an ounce after gold’s sister metal climbed 0.3% in the previous session.
Bullion investors will watch for what the ECB and Lagarde say about the strength of the euro EURUSD, +0.75%, which has weighed on the U.S. dollar. A stronger dollar can create headwinds for asset priced in precious metals. making them more expensive to overseas buyers.
The U.S. dollar was off 0.2%, as gauged by the ICE U.S. Dollar Index DXY, -0.50%, a measure of the U.S. currency against a half-dozen currencies. The euro maintains the biggest weighting in the dollar index, with the European monetary unit changing hands at was changing hands at $1.1851, up 0.4% against the dollar, according to FactSet data.
“Any dovish comments by Christine Lagarde will have a bearish impact on the euro, and this would once again be supportive for gold,” wrote Carlo Alberto Casa, chief analyst at ActivTrades in a note.
“Central banks’ activity and the hyper expensive monetary policies of the last few months have been one of the major market movers pulling up the gold price,” he wrote.
