Gold rises on weaker Chinese economic data

A member of staffs display gold products at a gold store on May 7, 2013 in Qionghai, Hainan province. [Meng Zhongde/Asianewsphoto]

CHICAGO -- Gold futures on the COMEX division of the New York Mercantile Exchange rose slightly on weaker-than- expected Chinese economic data Monday.  

The most active gold contract for August delivery rose $3, or 0.22 percent, to settle at $1,386 per ounce.

Chinese government released a series of economic data over the weekend: China's producer price index fell 2.9 percent in May from a year earlier, quicker than a 2.6 percent decline in April year on year; total social financing dropped by about a third to 1.19 trillion yuan ($194 billion=) in May from April; total property investment in China in the first five months of this year rose 20.6 percent to 2.68 trillion yuan, compared with a 21.1 percent rise in the first four months; fixed-asset investment in non-rural areas rose 20.4 percent in the January-May period year on year, slower than the 20.6 percent increase recorded in the January-April period; value-added industrial output in China rose 9.2 percent in May year on year, slowing slightly from a 9.3 percent increase in April; and exports rose 1 percent in May from a year earlier, much slower than April's increase of 14.7 percent. Disappointing Chinese economic figures were nevertheless positive to gold prices.

Gold market is still waiting for directions, which will hinge heavily on when the US Federal Reserve will scale down its bond- purchase program.

Though the underlying physical demand for gold remains strong, gold prices have registered a 17-percent decline so far this year.