Gold hovers near 2-week peak as dollar, U.S. bond yields weaken

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  p Spot gold held its ground at 1,865.39 per ounce, as of 0042 GMT. U.S. gold futures were also steady at 1,864.80. p

  p Gold prices rose to their highest level since May 9 of 1,869.49 on Tuesday, as the safehaven metals appeal was lifted by a weaker U.S. dollar and lower Treasury yields amid subdued risk appetite in financial markets. p

  p The dollar steadied after hitting its lowest level in a month in the previous session. A weaker dollar makes bullion less expensive for buyers holding other currencies. [USD] p

  p Shares slid worldwide on Tuesday as supply chain woes and surging costs hurt corporate earnings and manufacturing output slowed, while Treasury yields dipped as the weakness in equities revived a safehaven bid for U.S. government debt. [MKTSGLOB] [US] p

  p As the Federal Reserve amps up its fight against 40yearhigh inflation with what is expected to be a string of big interestrate increases, one U.S. central banker injected a note of caution, warning headlong rate hikes could create “significant economic dislocation.” p

  p Higher shortterm U.S. interest rates raise the opportunity cost of holding bullion, which yields nothing. p

  p European Central Bank President Christine Lagarde said on Tuesday she saw the ECBs deposit rate at zero or “slightly above” by the end of September, implying an increase of at least 50 basis points from its current level. p

  p Spot silver dipped 0.1 to 22.07 per ounce, while platinum gained 0.2 to 955.75, while palladium edged 0.2 lower to 2,002.66. p

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