Gold Prices Rally Ahead Of Federal Reserve Comments

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SPDR Gold Trust (ETF) (NYSEARCA:GLD) prices ran up in premarket trading as the price of gold hovered closer to the psychological level of $1,300 again ahead of a series of speeches from Federal Reserve officials. Fed Presidents from St. Louis and San Francisco are set to deliver their speeches, which will serve as an important indication of the possibility of a rate hike next month.

Series of data releases

Gold Futures contracts for June delivery rose 0.23% to $1,277.30 during European trade. The rally has hit optimism that the U.S. economy could revive soon after stalling in the first quarter. Data released on Wednesday showed that the U.S. services sector expanded in April on account of rising orders and employment.

However, this report was offset by other data that showed that U.S. employers hired less workers over the last three years. Following these sets of data, the initial jobless claims report is set to release today, which will further give guidance on the direction of the U.S. economy.

Randgold’s production worries

Meanwhile, gold miner Randgold Resources Ltd. (ADR) (NASDAQ:GOLD) declined steeply after posting first quarter results. Though the company recorded profits 25% higher than the previous year, its poor production at Kibali and Tongon mines was the cause of worry for investors, according to Royal Bank of Canada Analyst, Tyler Broda.

Yamana Gold Inc. (USA) (NYSE:AUY) posted net income of $36.3 million in its first quarter versus a loss that it accrued last year during the same period. The earnings of the company stood at $0.04 per share while its revenues came in at $430.3 million.

Alongside this, gold miner Franco Nevada Corp (NYSE:FNV) too posted results for its first quarter. The Toronto-based company posted net income of $30 million and earnings of $0.18 per share. Earnings exceeded the analysts’ expectations of $0.13 per share. Revenues came in at $132 million, surpassing analysts expectation of $129.2 million.

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