Gold granulate is seen at a plant of gold refiner and bar manufacturer Valcambi in the southern Swiss town of Balerna. Picture: REUTERS/MICHAEL BUHOLZER
Gold granulate is seen at a plant of gold refiner and bar manufacturer Valcambi in the southern Swiss town of Balerna. Picture: REUTERS/MICHAEL BUHOLZER

Bengaluru  — Gold prices rose on Friday, recovering from the previous session’s sharp fall, as the dollar dipped and mounting concerns about a slowdown in global economic growth boosted demand for the safe-haven bullion.

Spot gold had gained 0.2% to $1,297.95/oz, as of 4.54 GMT, after shedding about 1% the day before. US gold futures were up 0.2% at $1,297.80/oz.

The dollar slipped 0.1% against major currencies and was on track for its biggest weekly loss since early December.

“The dollar has weakened and gold as a safe-haven asset has seen support from Brexit uncertainty. As long as gold can hold the $1,290 level, it can reach the first level of $1,302 and then $1,310,” said Ajay Kedia, director at Kedia Commodities in Mumbai.

“The support we are now seeing at $1,290 shows that as long as there is lack of clarity on the [Brexit] deal, gold should be holding well.”

British legislators voted on Thursday to seek a delay in Brexit, setting the stage for Prime Minister Theresa May to renew efforts to get her divorce deal approved by parliament next week.

Providing additional support to bullion were increasing signs of a global economic slowdown, analysts said.

The Bank of Japan on Friday cut its assessment on overseas economies, saying they were showing signs of a slowdown. It also revised down its view on exports and output.

Meanwhile, comments from China’s premier about a slowing economy suggest that one of the world’s biggest economies is struggling, which is offering gold a bit of support, said Brian Lan, MD at dealer GoldSilver Central in Singapore.

In the US, data released on Thursday underscored growing pressure on the economy. The number of Americans filing applications for unemployment benefits increased more than expected last week while new home sales fell more than expected in January.

“Data from the US is not so good. So, weak US data and Brexit are holding gold prices up,” Kedia said, adding the uncertainty around US-China trade talks was still prevailing in the market.

A summit to seal a trade deal between US President Donald Trump and Chinese President Xi Jinping will not happen at the end of March as previously discussed because more work is needed in US-China negotiations, treasury secretary Steven Mnuchin said on Thursday.

In other precious metals, palladium slipped 0.1% to $1,555.90/oz, but was still was on track for a 2.7% weekly gain.

Silver gained 0.6% to $15.27/oz, while platinum jumped 1.2% to $828.57.