Gold prices have steadied on Thursday, following strong gains a day earlier, as the metal pushed above the key $1300 level. Late in the European session, the spot price stands at $1305.56 an ounce. In economic news, the ECB maintained is benchmark interest rate at 0.15%. We'll hear from ECB President Mario Draghi later in the day as he hosts a press conference.
With the crisis in Ukraine continuing, gold gained ground on Wednesday, as the safe-haven metal benefitted from investor nervousness. Gold pushed above the $1300 line, climbing as high as $1309. The US has accused Russia of massing troops on its border with Ukraine, and tensions are high as the EU has slapped stronger sanctions on Russia, while Moscow has responded with counter-sanctions of its own. The crisis has taken an economic toll on the Eurozone, as German numbers are down, and the Bundesbank is expecting a decline in German GDP in the second quarter. Germany and Russia are major trading partners, and the euro could drop to lower levels if the Ukraine crisis continues.
On Tuesday, ISM Non-manufacturing PMI looked sharp, rising to 58.7 points last month. This easily beat the estimate of 56.6, and was the index's best showing since February 2011. This follows a strong Manufacturing PMI reading last week, with the index climbing to 57.1 points, a three-year high. There was more positive news on Tuesday, as Factory Orders had an impressive July, gaining 1.1%. These solid numbers point to healthy expansion in the US manufacturing and services sectors, and have helped strengthen the dollar and keep gold prices below $1300.
XAU/USD 1305.56 H: 1308.57 L: 1302.05
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