Gold rose on Thursday as a drop in the dollar triggered bargain hunting after the previous session’s sharp drop on news of possible gold sale by Cyprus and uncertainty over Fed’s monetary stimulus.
An improving US economic outlook and rallies in the equities market, however, could pressure bullion prices in the near term, analysts said.
The metal was boosted by currency fluctuations as the dollar fell against the euro but rose to a four-year high against the yen. Gold has benefited from the Bank of Japan’s pledge last week to inject around $1.4 trillion into its economy to battle deflation.Bullion’s gains came as the S P 500 index climbed to fresh all-time intraday highs after US data showed jobless claims dropped more than expected.Gold has recently moved in opposite directions to US equities and an overall improvement in US economic indicators has hurt bullion’s safe-haven appeal.
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Gold rebounds from 1-week low as dollar slips
Thailand has agreed to undertake due verification of the Certificates of Origin on gold jewellery being exported to India, sources said.
Concerned over the rising current account deficit (CAD), India’s commerce ministry had in February sought suspension of gold jewellery imports from Thailand till the time the Certificate of Origin issued by that country was verified to India’s satisfaction.
Last week, officials from both the countries discussed the issue. “It was agreed that due diligence and verification will be undertaken by Thailand to ensure there is no discrepancy,” sources said. Both sides are going to work on the issue, the sources added, adding a review meeting is expected to take place after three months.
The certificates from Thailand showed a value addition of nearly 22 per cent to take benefit of preferential trade with India under the Early Harvesting Scheme (EHS) but the actual value addition was not more than two to three per cent, in tune with market norms. Import of gold jewellery from Thailand attracts a concessional duty of only one per cent under the EHS, a bilateral agreement. India imposes a 10 per cent tax on imports from other countries.