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Gold is trading higher today on Wednesday as uncertainty over the developments in Greece are in the focus. Yesterday gold declined markedly on news that the new Greek government retreated from a plan for a write-off of its debt and proposed a new debt arrangement to reach a compromise with its international creditors on the terms of its bailout. Finance Minister Varoufakis reassured in London that Greece is not seeking a standoff with the European Union. Earlier in yesterday's session gold rose on mixed U.S. data from Moday.
Market participants also look ahead to a set of U.S. data including the ADP Unemployment Report, Services PMI and the ISM Non-Manufacturing index and non-farm payrolls on Friday to get a better judgement on when the FED is going to rise interest rates. A future interest rate hike adds pressure on gold. Higher interest rates make gold less attractive as the metal is not yield-bearing. A stronger greenback recently also weighed on the dollar-denominated precious metal as it makes it more expensive for holders of other currencies
In January gold prices increased by almost 8% as the precious metal was sought after as safe-haven asset.
The precious metal is currently quoted at USD1,267.50, +0,55% a troy ounce. On Thursday the 22nd of January gold reached a five-month high at USD1,307.40.
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