Gold Prices Climb After BOJ Announces Easing (Update1)
Gold for February delivery rose $6.20 to $1,693.20 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,695.90 and as low as $1,684.80 an ounce, while the spot price was adding $4, according to Kitco's gold index.
"Bank of Japan move signals possible inflation down the road," George Gero, precious metals strategist at RBC Wealth Management, wrote in a note on Tuesday.
The Bank of Japan announced it would implement an open-ended, monthly purchasing program of about $11.28 billion of Treasury bills and Japanese government bonds, which would begin in January 2014.
The central bank also announced a 2% inflation-rate target.
The National Association of Realtors reported Tuesday that existing-home sales fell to 4.94 million in December from 5.04 million in November. Consensus among economists polled by Thomson Reuters had expected sales to rise at a seasonally adjusted annual rate of 5.1 million units.
The housing market has proven resilient in recent months in a sign that the U.S. economy has continued to strengthen despite sustained high unemployment rates and sluggish growth in the private sector.
Gold prices trend to the downside as economic indicators show signs of longer-term improvement as some investors view the yellow metal as a safe haven against economic uncertainty.
The economic calendar for this shortened week is light with initial jobless claims and a Purchasing Managers' Manufacturing index flash to print on Thursday, and a new-home report on Friday.
Gold's biggest movers in recent weeks have been announcements from the Federal Reserve and the European Central Bank.
The Federal Open Market Committee -- the Fed's policy-making wing -- roiled gold prices at the beginning of January when it reported mixed sentiment on the possible early conclusion of its monetary-stimulus programs.
Prices popped, though, the following week when ECB President Mario Draghi said he was optimistic about growth in the eurozone in the second half of 2013, and that he would not rule out possible easing measures moving ahead.
-- Written by Joe Deaux in New York.
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