Gold fighting to avoid a weekly drop as the dollar traded near a four-month high after the latest report on inflation – the producer price index. Futures gained some strength Friday as the spread of the delta variant of the coronavirus continued to worsen, exacerbating uncertainty and keeping a floor under prices.
The producer price index rose 7.8% in July, compared with a year earlier, the highest figure since the data series began in 2010. The figure was more than economists expected. The report came one day after the release of the consumer price index for July, which held at a 13-year high.
December gold futures slipped $1.50 Thursday to settle at $1,751.80 an ounce on Comex and are down 0.6% in the first four days of the week. The precious metal is down 3.6% so far this month after increasing for the third time in four months in July. Gold climbed $372 — or 24% — in 2020 because of uncertainty about the economy and the pandemic and is down 7.6% so far in 2021. The December contract is currently up $13.30 (+0.76%) an ounce to $1,765.10 and the DG spot price is $1,765.60.
The yellow metal has come under pressure as high inflation numbers have increased speculation that the Federal Reserve will taper stimulus measures sooner rather than later. Gold is a traditional hedge against inflation.
In other economic news, U.S. initial jobless claims fell for a third week, signaling that the labor market may be continuing to recover from the pandemic.
September silver futures fell 1.6% Thursday to settle at $23.12 an ounce on Comex The front-month contract was down 5% for the first four days of the week. Silver is down 9.5% so far this month after dropping 2.5% in July. The metal rose 47% in 2020 and is down 12% so far this year. Silver prices are tied to industrial demand, which could taper if lockdowns are reinstated and dampen manufacturing. The September contract is up $0.038 (+0.16%) an ounce to $23.430 and the DG spot price is $23.57.
Spot palladium fell 0.6% Thursday to $2,641.00 an ounce and is little changed this week. It fell 4.3% in July and is up 7.8% so far in 2021. Currently, the DG spot price is up $30.10 an ounce to $2,664.00.
Spot platinum slipped 70 cents Thursday to $1,029.50 an ounce and is little changed so far this week. The autocatalyst decreased 2.1% in July and is down 4.1% in 2021. The DG spot price is currently up $3.50 an ounce to $1,033.50.
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