Gold futures edge up after BOJ comments
July 10 (MarketWatch) — Gold futures turned higher Tuesday after the Bank of Japan said it will up its asset purchases to help beat deflation, and as the euro rose against the dollar.
The metal rose after Bank of Japan Governor Masaaki Shirakawa said the bank was implementing “strong monetary easing steps, such as its near-zero interest rate policy and asset purchases in order to overcome deflation,” in comments while attending a government meeting.
Shirakawa said the central bank has accumulated up to ¥54 trillion ($681 billion) of asset purchases so far, but is aiming for ¥70 trillion. And through the accumulation of another ¥16 trillion in assets, “we believe the impact of monetary easing will be further enhanced,” he was quoted as saying.
“Banks are now starting to pick up gold, given the amount of monetary stimulus pumped in across various economies across world,” said Michael Hewson, senior market analyst at CMC Markets. “They’re trying to mitigate currency exposure and currency depreciation.
“If you take the view the Fed is going to print more money, it would make sense for central banks to hold more gold,” said Hewson. “It’s the only thing you can’t manipulate print or devalue.”
