Gold steady ahead of this afternoon’s release of the Fed minutes. Opposing pressures early Wednesday kept the bullion in check. The dollar and Treasury yields rose to multiyear highs while haven demand from the Ukraine war and the pandemic kept prices supported.
The dollar reached the highest level in almost two years after comments Tuesday from Federal Reserve Governor Lael Brainard and San Francisco Fed President Mary Daly on aggressively raising interest rates to combat soaring inflation. Rate hikes are typically bearish for gold and bullish Treasurys and the dollar.
Investors are awaiting the release of the minutes of the last meeting of Fed policymakers, Wednesday at 2 pm EDT, for further direction. Brainard and Daly are considered two of the least aggressive Fed policymakers, so their comments sent the dollar and Treasurys soaring and equities falling. “It is of paramount importance to get inflation down,” Brainard said during a Minneapolis Fed webinar. Later Tuesday, Daly said the Fed won’t let 40-year highs in inflation “go forever.”
Front-month gold futures fell 0.3% Tuesday to settle at $1,927.50 an ounce on Comex, though the June contract gained 0.2% in the first two days of the week. Gold advanced 2.8% in March after gaining 5.8% in February. It gained 6.9% in the first quarter and retreated 3.5% in 2021. The June contract is slightly up at post time, $1.90 (+0.10%) an ounce to $1,929.40 and the DG spot price is $1,931.30.
Gold continued to attract haven investors because of the war between Russia and Ukraine and the continuing pandemic and the new secondary omicron variant of the coronavirus — BA.2.
Ukrainian President Volodymyr Zelenskyy on Tuesday addressed the United Nations Security Council and once more alleged that Russia slaughtered civilians in the Ukrainian town of Bucha, on the outskirts of Kyiv. He called for a war-crimes tribunal, but Russia is one of the five permanent members of the U.N. Security Council and has veto power, so that’s unlikely.
Front-month silver futures decreased 0.2% Tuesday to settle at $24.53 an ounce on Comex, and the May futures contract dropped 0.5% in the first two days of the week. Silver gained 3.1% in March after surging 8.8% in February. It rose 7.6% in the first quarter after falling 12% in 2021. Silver prices are tied to industrial demand. The May contract is currently down $0.044 (-0.18%) an ounce to $24.490 and the DG spot price is i$24.55.
Spot palladium slid 2.3% Tuesday to $2,258.00 an ounce, and it decreased 1.6% in the first two days of the week. It touched a record $3,440.76 in March. Russia produces about 40% of the world’s palladium, and Russia’s Nornickel is the world’s largest supplier of palladium. The metal dropped 8.5% in March after gaining 5.3% in February. It gained 20% in the first quarter and retreated 22% in 2021. The DG spot price is currently down just a tad, $0.30 an ounce, to $2,265.00.
Spot platinum decreased 1.1% Tuesday to $982.20 an ounce and is down 1% so far this week. The metal dropped 4.2% in March after advancing 1.7% in February. It increased 2.9% in the first quarter after dropping 9.4% last year. Currently, the DG spot price is down $5.00 an ounce to $973.10.
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