After a 1.02 percent loss in January and a 5.54 percent loss in February, gold inched up by 1.56 percent in March, though the precious metal is still down five percent for the first quarter of the year.
Gold prices were bolstered in late March by safe-haven buying that occurred as a response to the financial crisis in Cyprus. Analysts expect increased demand in India during the nation’s wedding and festival season, uncertainty regarding North Korea and strong purchasing managers index data from China to affect April gold prices.
“We are in an uncertain market,” Brian Lan, the managing director of Singapore-based GoldSilver Central, said. “Normally a strong PMI data from China would tend to draw investors towards stocks and not support gold prices, but this time we see a reverse. The North Korea tension is adding to the market uncertainty.”
Arthur McGuire, the vice president of Gold Price, expects gold prices to improve during the second quarter.
“The Indian wedding season demand will have a huge effect on the gold price, and economic uncertainty seems to only be piling up around the globe,” McGuire said. “Gold has also been experiencing 21-22 month peak cycles over the last five years, and that cycle is due to peak once again sometime in May or June. Despite what many bearish naysayers are predicting, gold’s future is pretty bright. We are excited to see how it performs in the coming months.”