- Write by:
-
Saturday, July 23, 2022 - 13:00:04
-
496 Visit
-
Print
Mining News Pro - Gold held onto gains and headed for its first weekly advance since early June as investors weighed renewed concerns over economic growth.
Bullion’s reversal comes with more economic data fueling fears of a recession. US business activity contracted in July for the first time in more than two years, according to data released Friday, adding to a slew of indicators earlier in the week that are painting a gloomy outlook. Meanwhile, a gauge of the greenback has retreated from its July 14 peak.
“We are finally starting to see some weakness in the US dollar index, as gold bounces off an oversold level, recovering above $1,700 for now,” said John Feeney, business development manager at Sydney-based bullion dealer Guardian Gold Australia. “We now expect this initial flight to the US dollar to start rotating back into gold as investors search for a true and reliable hedge against inflation.”
Also weighing on gold is ongoing selling by exchange-traded fund investors, Commerzbank AG analyst Carsten Fritsch said in a note. Investors have withdrawn more than 100 tons from gold ETFs during the past four weeks, Fritsch said.
“ETFs recently saw outflows on 17 consecutive days,” he said.
Investors will closely watch the Federal Reserve’s meeting on July 26-27 for clues about its monetary policy path. On Thursday, the European Central Bank raised its key interest rate by 50 basis points, the first increase in 11 years, as it confronts surging inflation. Gold climbed above $1,700 an ounce following this larger than expected rate hike.
“Even when the euro shed its gains again” Fritsch said, “gold remained at its higher level.”
Spot gold rose 0.1% to $1,721.11 an ounce at 2:29 p.m. in New York. Prices climbed 1.3% in the prior session after earlier dropping to the lowest intraday level since March 2021. Gold futures rose 0.8% to settle at $1,745.30 on the Comex. The Bloomberg Dollar Spot Index fell 0.3%. All other precious metals rallied except silver, which fell 1.1%. Palladium lead gains at 7%.
Palladium is becoming the go-to commodity trade after strong earnings from Tesla and as Chinese consumers resume car purchases. If dollar weakness continues, palladium will be one of the commodities that benefit during this global economic growth downturn, according to Ed Moya, senior market analyst at Oanda.
“Palladium will benefit as recession fears for the US should put a cap on the dollar rally and demand for cars should still remain strong across US and China,” he said. “I think some traders viewed today’s first half of China auto sales as very positive for palladium.”
Short Link:
https://www.miningnews.ir/En/News/621807
The four largest indigenous communities in Chile’s Atacama salt flat suspended dialogue with state-run copper giant ...
A prefeasibility study for Predictive Discovery’s (ASX: PDI) Bankan gold project in Guinea gives it a net present value ...
A Native American group has asked all members of a US appeals court on Monday to overturn an earlier ruling that granted ...
Representatives from the Peñas Negras Indigenous community, in northwestern Argentina, clashed with heavily armed police ...
The London Metal Exchange (LME) on Saturday banned from its system Russian metal produced on or after April 13 to comply ...
The world’s coal-fired power capacity grew 2% last year, its highest annual increase since 2016, driven by new builds in ...
Peabody Energy Corp. shares sunk to the lowest in seven months after the biggest US coal miner warned that first-quarter ...
Newmont confirmed on Wednesday that two members of its workforce died this week at the Cerro Negro mine located in the ...
Chinese investors are snapping up stocks tied to high-flying metals from copper to gold, aiding an onshore market facing ...
No comments have been posted yet ...