Gold Ends Higher On Global Cues

(RTTNews) - Gold futures snapped a two-day loss to end higher on Monday, after some soft data from China and Japan lifted hopes of additional stimulus. The precious metal also found support with the dollar trending lower against some major currencies, even as global equity markets declined.

Official data from China showed some weak trade activity in the world's second largest economy, with both export and import missing expectations. Elsewhere in Asia, revised data showed Japan's economy in the third quarter to have contracted more than previously reported.

Meanwhile, the European Central Bank also continued to be under pressure for additional stimulus, a few days after the ECB President Mario Draghi said the bank is ready to take further action to avert deflation. Another top official of the European Central Bank warned consumer prices will continue to rise at an anemic pace next year.

"For the first quarter of 2015 we must expect falling inflation rates with a large probability," said European Central Bank Governing Council member Ewald Nowotny.

Gold for February delivery, the most actively traded contract, gained $4.50 or 0.4 percent to settle at $1,1194.90 an ounce on the Comex division of the New York Mercantile Exchange on Monday.

Gold for February delivery scaled an intraday high of $1,198.70 and a low of $1,187.30 an ounce.

On Friday, gold futures ended lower at $1,190.40 an ounce, down $17.30 or 1.4 percent, on positive global equity markets after some strong U.S. non-farm payrolls data for November, with the dollar rising to multi-year highs against some major currencies.

According to data released by the Labor Department employment increased much more than anticipated November with the number of jobs created in the month hitting a near three-year high.

Some downbeat data including a report showing a bigger than expected drop in factory orders in October failed to support the bullion.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged higher to 720.91 tons on Monday, from its previous close of 720.02 tons.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 89.05 on Monday, down from its previous close of 88.33 late Friday in North American trade. The dollar scaled a high of 89.55 intraday and a low of 89.05.

The euro trended higher against the dollar at $1.2329 on Monday, as compared to its previous close of $1.2288 late Friday in North American trade. The euro scaled a high of $1.2329 intraday and a low of $1.2248.

In economic news, China's merchandise trade surplus came in at $54.47 billion in November, well above the forecast of $41 billion, following the $45.41 billion surplus in October.

China's exports rose at a slower than expected pace, rising 4.7 percent on year in November, while economists expected exports to rise 9.0 percent. China's imports tumbled an annual 6.7 percent versus forecast for a gain of 4.0 percent.

From the eurozone, German industrial production growth softened in October on a notable fall in energy output, official data revealed Monday. Industrial output grew 0.2 percent in October from a month ago, Destatis said. Production was forecast to rise 0.3 percent after expanding by a revised 1.1 percent in September.

Meanwhile, the French economy is expected to grow 0.1 percent in the fourth quarter as estimated in the prior month, survey data from the Bank of France showed Monday. The business confidence index rose marginally to 97 in November from 96 in October.

A slew of economic data are due this week, including weekly jobless claims, a report on retail sales for November and the preliminary consumer sentiment reading from Reuters and the University of Michigan. Investors will also be looking ahead to the U.S. Commerce Department's wholesale and business inventories report for October and the Labor Department's producer prices data for November.

Japan's gross domestic product declined in the third quarter of 2014, downwardly revised to 1.9 percent on year, the Cabinet Office said in Monday's final reading - confirming the country's slide into recession. The headline figure missed the forecast for a decline of 0.5 percent, which would have been an improvement over the 1.6 percent decline in last month's preliminary estimate.