Chat with us, powered by LiveChat
Menu

US Gold Prices Rise Nearly 1% This Week As Dollar Fell

increase inflation gold demand
Print Friendly, PDF & Email

EDITOR'S NOTE: We saw how investors responded to Russia’s pledge to scale back military operations and possibly agree to a ceasefire with Ukraine. Gold took a breather. Not more than a day later, the White House announced that Russia’s pledge may be nothing more than a diversionary tactic to regroup and renew its attack elsewhere. We saw the gold market’s response to that as well. Right now, US gold prices remain in a volatile hovering pattern, well above its $1,880 support and seemingly poised to break above resistance at $1,967 before potentially challenging its $2,000 highs. Economic data this week is a bit on the light side. And while the markets appear hypersensitive to the latest news coming out of Ukraine, it makes us wonder whether a quick end to the hostilities might be achievable. If the war drags on, exacerbating the inflationary factors that are already driving up costs, what are we to say about gold’s pricing in the market? Would the current price range for gold not make for a favorable or unfavorable buying point; would it constitute a discounted or overvalued range of prices?

March 30 (Reuters) - Gold prices rose nearly 1% on Wednesday, supported by a retreat in the U.S. dollar and renewed doubts about the possibility of a ceasefire between Russia and Ukraine.

Spot gold XAU= was up 0.7% at $1,932.14 per ounce by 03:26 p.m. EDT (1926 GMT).

U.S. gold futures GCv1 settled up 1.1% to $1,939.

The U.S. dollar =USD fell 0.6% to nearly a two-week low, making greenback-priced gold less expensive for other currency holders. USD/

Also helping gold, “this Russian situation, which seemed to be improving yesterday is now kind of deteriorating again”, said Edward Meir, an analyst with ED&F Man Capital Markets.

The Kremlin on Wednesday welcomed that Kyiv had set out its demands for an end to the conflict in Ukraine in written form, but said there was no sign of a breakthrough yet. (Full Story)

Gold prices dropped as much as 1.8% on Tuesday after Russia pledged to cut down on military operations around Kyiv and in northern Ukraine, but bullion pared most of the losses to settle just 0.2% lower for the day. (Full Story)

Markets also were keeping a close tab on the U.S. 2-year/10-year Treasury yield curve, which briefly inverted on Tuesday, as bond investors bet that aggressive tightening by the Federal Reserve to fight soaring inflation could hurt the U.S. economy. (Full Story) US/

Bullion is considered a safe store of value during times of political and financial uncertainty. It is also viewed as a hedge against rising inflation.

“A strong bounce-back in crude oil prices from this week’s low is also a bullish element for the metals markets, as well as the rest of the raw commodity sector,” Jim Wyckoff, senior analyst at Kitco Metals, said in a note. O/R

Spot silver XAG= rose 0.1% to $24.78 per ounce, while platinum XPT= climbed 0.6% to $988.27.

Palladium XPD= gained 4.6% to $2,246.69 after dipping to more than a two-month low of $2,032.97 on Tuesday.

Reporting by Brijesh Patel in Bengaluru; Editing by Paul Simao, Emelia Sithole-Matarise and Marguerita Choy

Our Standards: The Thomson Reuters Trust Principles.

Originally published on Reuters.

2022 Info Kit

GET YOUR FREE

GOLD SILVER INFO KIT

Precious Metals and Currency Data Powered by nFusion Solutions