Gold prices fall, but seek third consecutive weekly gain
Gold futures fell in trading on Friday, but after six consecutive session gains, they remained on track for a third weekly rise.
Prices on Thursday stabilized at their highest in more than four months, extending a streak of daily gains to the longest since July 2020.
“The growing uncertainty surrounding the [Federal Reserve’s] course of action over the next few months and how that will affect inflation and US stock market levels, ”have helped support gold prices, said Jeff Klearman, portfolio manager at GraniteShares, which offers the GraniteShares Gold Trust BAR,
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The US central bank has “repeatedly stated that it will keep rates close to zero for a while by tightening monetary policy, if necessary, by reducing its Treasury and mortgage-backed securities buyback program first.” He told MarketWatch. “Worries that the Fed may need to raise rates sooner or later due to higher than expected inflation have disrupted equity markets, increasing investors’ desire for gold as a safe haven investment.”
On a related note, “the rapid and sharp decline of bitcoin BTCUSD,
and other cryptocurrencies affected by the same uncertainty that plagues the US stock markets, may have caused cryptocurrency investors to lose faith in cryptocurrencies as a ‘replacement for gold’ and to heading straight for gold as a safe haven investment, Klearman said.
Meanwhile, the strength of the US dollar has also contributed to the overall gains of gold, he said. The ICE US Dollar DXY index,
is trading more than 1% less for the month and more than 3% for the quarter.
At the last control, June or GCM21,
fell $ 3.80, or 0.2%, to $ 1,878.10 an ounce.
July silver SIN21,
also lost 35 cents, or 1.3%, to nearly $ 27.72 an ounce.
For the week, gold futures, based on the most active contracts, are on track for a gain of more than 2%, which would mark its third consecutive weekly gain, while silver s’ trade over 1% from last week’s settlement, FactSet data exposure.
Gold prices have struggled to climb above the $ 1,900 mark, a level it hasn’t been able to reach since early January of this year.
However, there are certain conditions under which it can succeed in moving solidly above this level, including “lingering uncertainty over the ability or willingness of the Fed to maintain its aggressively accommodative monetary policy”, Klearman said.
In addition, “data confirming that inflation is more than transient, and that the Fed will be forced to act sooner or later, may increase volatility in US stock markets and cryptocurrencies and support gold prices. “, did he declare.
Among the other metals traded on the Comex, the July copper HGN21,
tossed 0.9% to $ 4.52 a pound, trading about 3% less for the week.
Copper prices, which were up more than 1.5% until Tuesday, fell more than 3% on Wednesday “after China announced it will act to prevent” unreasonable “price increases “said Klearman, who added that China is responsible for more than half of the world’s copper consumption. .
July platinum PLN21,
was down 1% to $ 1,192.60 an ounce, down about 2.5% on the week, while June PAM21 palladium,
lost 3.1% to $ 2,782.50 an ounce with the contract on track for a weekly loss of 3.8%. September palladium PAU21,
which is also among the most active, fell 2.6% to $ 2,806 an ounce.
Earlier this week, Metals Focus estimated that this year platinum supplies will remain in surplus, but the palladium deficit is expected to climb.