Gold steady heading for first weekly gain in six weeks boosting on the slump in U.S. Treasury yields, however the yellow metal is still pressured by the dollar that is trading near 20-year highs and an aggressive monetary policy expected to put a damper on inflation.
The European Central Bank announced its first interest-rate increase since 2011 in an effort to stem soaring costs of goods and services. The decision came less than a week before Federal Reserve policymakers are expected to boost rates by another 75 basis points.
December gold futures rose 0.8% Thursday to $1,731.30 an ounce on Comex. The front-month contract, which rolled to December from August this week, was up 1.6% in the first four days of the week. Bullion fell 2.2% in June after tumbling 3.3% in May, its worst month since September. The metal retreated 3.5% in 2021. The August gold contract is currently up $11.20 (+0.65%) an ounce to $1,724.60 and the DG spot price is $1,727.10.
The ECB announced Thursday that it would raise rates by 50 basis points to take the main rate back to zero. The Bank of Japan kept interest rates on hold Thursday.
Investors were turning their attention back to the U.S. ahead of next week’s Fed policy meeting.
U.S. initial jobless claims hit the highest level since mid-November last week, data released Thursday showed. Claims reached 251,000 last week, 7,000 more than the week before and above the 240,000 estimate of economists surveyed by Dow Jones. Reflecting pessimism in the economy, the leading economic index published by the Conference Board fell 0.8% in June, more than the 0.6% that economists had expected.
Investors will be watching Friday for the flash PMI release for further direction.
Fears of an economic recession and uncertainty over the pandemic and the war in Ukraine have kept a floor under gold prices. Recession speculation grew earlier this month after data showed the U.S. consumer price index rose 9.1% in June.
September silver futures gained 0.3% Thursday to settle at $18.72 an ounce on Comex, and the front-month contract advanced 0.7% in the first four days of the week. Silver declined 6.2% in June after falling 6.1% in May. It retreated 12% in 2021. Silver prices are tied to industrial demand. The September contracts is up $0.026 (+0.14%) an ounce to $18.745 and the DG spot price is $18.84.
Spot palladium rose 1% Thursday to $1,913.00 an ounce and is up 2.1% this week. It lost 2.9% in June after losing 14% in May, the biggest monthly decline since September. It retreated 22% in 2021. Currently, the DG spot price jumped $57.80 an ounce to $1,969.50.
Spot platinum increased 2.2% Thursday to $886.00 an ounce, and it’s up 3.1% so far this week. It lost 7.2% in June after gaining 2.3% in May and losing 9.4% last year. The DG spot price is currently up $13.80 an ounce to $895.50.
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