Precious Metals: Gold Prices Outlook
Gold prices set to rise next week. Reuters

Gold prices are set to rise next week as the yellow metal's trend is expected to remain upward.

In addition, next week's prices are likely to be influenced by manufacturing and services sector data due from China, the world's leading gold consumer.

As many as 10 of 21 analysts polled in a Kitco Gold Survey said they expected gold prices to rise next week, while six predicted that prices would drop and five forecast prices to remain unchanged.

Jim Wyckoff, technical analyst at Kitco said: "Trend remains up, so path of least resistance is the same."

Mark Leibovit, editor, VR Gold Letter, said: "[I'm] liking platinum and palladium more than gold, but will still give gold the benefit of the doubt for further gains, especially (if) a currency war could be unfolding between Russia and the US," referring to the tensions between Russia and the Ukraine over the Crimean peninsula.

However, VTB Capital analyst Andrey Kryuchenkov told Reuters that "in the short term, given the better-than-expected [US nonfarm payrolls] data, and provided nothing happens in Ukraine over the weekend, gold could fall below $1,330."

Gold Ends Higher

US gold futures for delivery in April dropped on 7 March and finished at $1,338.20.

Futures gained 1.26% for the week as a whole.

Spot gold shed 1.5% to a session low of $1,329.35 an ounce in intra-day trade 7 March.

For the week, gold prices pared most of the gains supported by geopolitical events after strong US labour market data eased fears of an unexpected slowdown in the world's leading economy, denting gold's safe-haven allure.

American employers added 175,000 jobs in February after creating 129,000 new positions in January. The unemployment rate, however, rose to 6.7% from a five-year low of 6.6%, government data showed.

Economists polled by Reuters had expected non-farm payrolls to increase by 149,000 and the unemployment rate to remain steady at 6.6%.

London Gold Fix

Five banks, including Barclays, Deutsche Bank and HSBC have been accused in a US lawsuit of manipulating the London gold fix, an age-old pricing of gold twice daily.

According to a Bloomberg report, Kevin Maher, a New York resident who said he bought and sold gold and gold futures and options alleges that the banks overseeing the gold benchmark - Societe Generale and Bank of Nova Scotia were also named - colluded to manipulate it.

Maher's complaint cited press reports, including a Bloomberg report, about a draft research paper that highlighted alleged unusual trading patterns connected to the London gold fix.

The research paper looking into possible manipulation of the benchmark was authored by New York University's Stern School of Business Professor Rosa Abrantes-Metz and Albert Metz, a managing director at Moody's Investors Service.

Earlier, gold prices dropped from the highest level in over four months after Russia ended military exercises in an area that borders crisis-hit Ukraine, which had sparked demand for gold as a safe haven.