Gold prices rose during trading on Tuesday, with the dollar retreating from its highest levels in two decades, prompting investors to choose bullion priced in the US currency.
This comes at a time when investors are waiting for key US data for clues regarding the Federal Reserve’s stance on raising interest rates.
Gold prices ended their trading Monday, May 9, with a decline of about 24 dollars, with the rise in the US currency and government bond yields.
Gold prices today
By 08:05 AM GMT (11:05 AM GMT), gold futures contracts for June delivery rose by 0.01%, to reach the level of $ 1858.70 an ounce.
The spot price for the yellow metal also rose by 0.30%, at $1859.76 an ounce.
The price of silver contracts – for July delivery – also rose by 0.98%, to reach $21.89 an ounce.
While the price of palladium jumped by 2.58%, recording $2151.644 an ounce, and the spot platinum price rose by 1.62%, at $972.53 an ounce.
gold market situation
$1,850 is a key number, so it looks like a game of technical repositioning in gold rather than a fundamental driver, said Matt Simpson, chief market analyst at City Index trading firm.
Simpson added that big moves in either direction in major markets are unlikely before US CPI data – the main indicator of inflation – due on Wednesday, and may keep the dollar near recent highs and gold holding near its recent lows, Reuters reported.
Last week, the US Federal Reserve raised its benchmark interest rate by half a percentage point, as part of its roadmap for pandemic-era monetary tightening, and monthly CPI data will likely be closely watched for any impact that could have on plans to raise rates. US bank interest rates.
Gold is seen as a hedge against inflation and a safe store of value in times of political and economic crisis, but it is highly sensitive to rising short-term US interest rates, which raise the opportunity cost of holding non-yielding bullion.
The dollar fell, after rising overnight to a 20-year high in a volatile session.
The dollar’s rise makes the safe-haven yellow metal less attractive to holders of other currencies.
Looking ahead, the drivers are clear and straightforward for a bearish trend in bullion, as the prospect of higher interest rates and a stronger dollar have overshadowed any allure of gold as a safe haven,” said Michael McCarthy, Chief Strategist at Tiger Brooker.
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