PRECIOUS: Gold Rises 1% and Achieves 10th Quarterly Gain, According to Reuters

Gold Posts Smallest Quarterly Gain Since 2008

Gold prices increased by nearly 1 percent on Thursday, marking a 10th consecutive quarterly gain, driven by a decline in the dollar and rising oil and grain prices. These factors have reinforced gold’s attractiveness as a hedge against inflation.

Central banks’ loose monetary policies, continued concerns about sovereign debt in the euro zone, and political instability in the Middle East have all contributed to gold’s value, despite this being the smallest quarterly rise since the third quarter of 2008, just before the onset of the financial crisis.

Experts predict a positive second quarter for gold, citing ongoing geopolitical tensions and inflation as key factors. Bill O’Neill, managing partner of a commodities advisory firm, stated that there would likely be continued investment in gold, silver, and platinum.

Spot gold was up 0.8 percent at $1,435.10 an ounce by late afternoon. U.S. gold futures for June delivery also rose by 1.1 percent to $1,439.90, although the trading volume was lower than usual as investors transitioned their contracts.

Gold experienced its largest one-day increase in nearly two weeks, coinciding with the upcoming U.S. non-farm payrolls report for March, which is seen as a vital indicator of economic health. Traders indicated that many investors were purchasing gold as a safeguard against the uncertainty surrounding this report. The fears of inflation, spurred by rising oil prices and increased grain demand, further benefitted gold’s market position.

Looking ahead, technical analysts expect gold could break out of its recent trading pattern and possibly reach a record high of $1,500 an ounce.

Silver prices also reflected positive trends, rising 0.7 percent to $37.71 an ounce. Silver saw a remarkable 22 percent increase in the first quarter, marking its ninth consecutive quarterly gain. This surge has been attributed to investor optimism about further gains in gold and anticipated improvements in industrial demand for silver.

Additionally, the gold-silver ratio fell below 38, its lowest point since 1983, indicating strong momentum for silver as a favorable investment.

Concerns surrounding the euro zone’s debt situation provided additional support for gold prices, particularly as inflation data suggested a potential interest rate increase from the European Central Bank. However, this strength may be short-lived as peripheral debt issues in the euro zone are expected to continue.

Recent warnings from rating agencies about possible sovereign downgrades in euro zone countries have kept investors wary about the region’s financial stability.

In the United States, signs of recovery in the labor market could prompt some officials within the Federal Reserve to consider ending monetary easing sooner than anticipated, which may reduce some of gold’s appeal.

Platinum prices had a modest increase, rising to $1,766.49 an ounce, while palladium added 1.4 percent to reach $762.47.

As the market prepares for economic data releases, analysts continue to monitor the interplay between inflationary pressures and investment trends in precious metals.