The U.S. economic data showed a less significant change in the last week. The unemployment rate being less significantly change stood at 7.2% amid the previous data of 7.3%. The unemployment claims this week’s end decreased by 12,000 to 350,000 from a revised 362,000 in the prior period. The trade deficit in the U.S. was little changed in August showing a gap of 0.4% to $38.8 billion from a revised $38.6 billion in July.

The US durable goods orders in September rose to 3.7% supported by the increase in demand for the commercial and military aircraft. The Boeing in September alone received the orders for 127 planes against the 16 in August. The capital equipment demand surged during this period by 1.1%. Similarly, the core capital goods orders dropped by 1.5% showing that the corporate capital expenditure driven growth has surged due to Fed. The University of Michigan (UoM) consumer-sentiment index fell to 74.8 in October from 77.5 as from a month earlier.

In addition, the USD/EUR exchange rate surged to 1.3799 from 1.38032 as on the previous day showing a weaker USD and stronger EUR supporting the improvement in the European economy and weaker US economy. Supporting to the weaker US economic growth, the precious metal gold- regarded as the store of value has advanced. The existing figures have maintained the negative correlation between USD and gold prices.

Russia, the fourth largest producer of gold has reduced gold reserves by 0.37metric tons to 1015.1 tons in September. Following the Russia, Mexico and Canada also cut holdings whereas Kazakhstan expanded its gold reserves by 2.52 tons to 137.04 tons.

The stalemate ended on US budget and debt ceiling after a 16 days US government shutdown and the weaker US economic data do not support the tapering of the quantitative easing policy. The ongoing stimulus shows a support for the gold prices. The December delivery for gold rose by o.2% on the week end on Friday on the NYMEX. The gold bullion demand is seen advancing showing a positive sentiment beyond speculation supporting the upcoming festive season in India- Diwali, festival of lights. India has remained the top most gold consumer last year.

The luster for gold bullion has increased shifting the demand from the developed countries to the emerging markets especially towards Asian region as the store of value and instrument to hedge against inflation. The second quarterly report produced by World Gold Council shows that the demand for gold totaled 856.3 tonnes, worth US$39bn accounting for India and China’s consumption of almost 60% in  jewellery and around 50% in total bar and coins. The strong demand from Asian consumers absorbed gold flowing onto the market from sales by Western hedge funds and speculative investors.