#Metals Stocks: Gold prices edge higher, but firmer dollar, rising yields cap moves
Table of Contents
“#Metals Stocks: Gold prices edge higher, but firmer dollar, rising yields cap moves”
Gold traded slightly higher on Tuesday, with downbeat U.S. economic data helping the precious metal recoup some of the losses seen late last week, despite Treasury yields rising to highs not seen since 2020 and strength in the dollar.
Gold’s move up also came on the heels of a downturn in global stocks, with the Dow Jones Industrial Average
DJIA,
and the S&P 500 index
SPX,
which likely served to boost the metal’s investment appeal.
The Empire State survey of business conditions nosedived to -0.7 points in January from 31.9 in the prior month, the New York Federal Reserve said. It was the first decline in the index since June 2020. Economists had expected a reading of 25.5, according to a survey by The Wall Street Journal.
In Tuesday trading, February gold
GCG22,
GC00,
climbed by $2.90, or 0.2%, to reach $1,819.40 an ounce. The precious metal posted declines on Thursday and Friday, before Monday’s Martin Luther King, Jr. holiday, but still scored a 1.1% advance last week.
March silver
SI00,
SIH22,
rose 69 cents, or 3%, to trade at $23.61 an ounce, after gold’s sister metal climbed 2.3% last week.
Investing in gold in recent weeks has closely followed concerns about inflation and moves in the U.S. dollar, which the commodity has been pricing in.
Investors expect a surge in inflation will prompt the Federal Reserve to raise interest rates at least three times this year as it combats pricing pressures.
“Looking ahead, there are important inflation numbers we will be paying attention to this week from England, Canada, and Europe — also, U.S. housing demand numbers,” said Hatzigiannis.
“We believe gold will test the $1,800 level this week and our overall consensus is negative for the week, as we think inflation worries will just increase — causing interest rates to increase and a stronger dollar, which makes other safe haven assets more attractive,” he said.
Against that backdrop, the yield on the two-year Treasury note yield
TMUBMUSD02Y,
rose to 1.026%—around the highest level since February 2020, with the short-term government debt tending to be the most sensitive to expectations for higher interest rates from the Federal Reserve.
Meanwhile, the benchmark 10-year Treasury note yields
TMUBMUSD10Y,
around 1.845%, representing the highest level since January 2020.
Rising yields can undercut appetite for nonyielding precious metals.
Separately, the dollar has gained 0.4%, as gauged by the ICE Dollar Index
DXY,
which measures the currency against a basket of a half-dozen others.
In other Comex trading, March copper
HGH22,
lost nearly 0.1% to $4.417 a pound.
April platinum
PLJ22,
tacked on 2.1% to $984.80 an ounce and March palladium
PAH22,
climbed by 1.5% to $1,907 an ounce.
By
Myra P. Saefong
and
Mark DeCambre
If you liked the article, do not forget to share it with your friends. Follow us on Google News too, click on the star and choose us from your favorites.
For forums sites go to Forum.BuradaBiliyorum.Com
If you want to read more News articles, you can visit our News category.
