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SINGAPORE. – Gold rose towards its highest in nearly two weeks yesterday, as more sluggish US economic data supported the view that the Federal Reserve would delay a rate hike to next year. Spot gold had risen 0,1 percent to $1 148,16 per ounce by 3.31am GMT. The metal climbed to $1 151,20 in the previous session, its highest since September 24.

Liquidity was thin in Asian hours with top consumer China out on a holiday. Data on Tuesday showed that US exports took a hit from an ailing global economy in August and imports from China surged, fuelling the largest expansion of America’s trade deficit in five months. The data, following a weak non-farm payrolls report last week, has triggered a drop in the dollar and pushed the expectation of a rate hike to next year.

“We have to suspect that as US macro data starts to deteriorate, the dollar (is) likely (to) continue to weaken from here, providing further upside to impetus for gold,” said INTL FCStone analyst Edward Meir. A softer dollar would make gold cheaper for holders of other currencies, while a delay in rate hike could also support non-interest-paying bullion.

Gold has benefited in recent years from ultra-low rates, which cut the opportunity cost of holding the metal. Fed chairwoman Janet Yellen said in September that she expected the US central bank to begin raising rates this year, but weak US economic data since then and caution about the global economy has prompted many to push out the expectation. – Reuters.