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Wednesday, December 19th, 2018 - Buy Gold - Bringing you trusted gold news and gold investing information since 2006

China Pushes Gold To Its Fourth Day Of Gains

Gold is headed for its fourth day of gains, driven by prospects of greater demand from China – the second largest consumer of the commodity.

The increased demand from China, coupled with a softer dollar, has not only seen gains in gold, but also silver – heading towards is strongest weekly performance in two years.

China is a major consumer of both gold and silver, and data just released showed that inflation increased more than expected in the month of April, which also saw a slowing down of industrial output.

As a result, the central bank might decide to cut, rather than raise, rates in an attempt at staving off a more protracted economic slowdown, a prominent Chinese government economist told Reuters.

Slowing growth and high inflation in what is the world’s second largest economy could well act to increase the demand for gold.

“The markets greet high inflation data with gold going up because it acts as a hedge against inflation, but sometimes they greet it by going down because of the fear of rising interest rates,” said Mitsubishi analyst Matthew Turner.

He added “The underlying trend hasn’t changed in gold, and last week’s decline looks almost like a blip.”

By 0940 GMT spot gold XAU= rose 0.6 per cent to US$1,523.80 an ounce. June delivery GCcv1 COMEX gold futures rose 0.5 per cent to US$1,524.00.

Spot silver XAG= rose 2.7 per cent to US$39.48, before settling in at US$39.16. COMEX silver SIcv1 rose 1.8 per cent to US$39.18.

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