Home Business Precious metals rally as U.S. dollar extends losses

Precious metals rally as U.S. dollar extends losses

3 min read
Comments Off on Precious metals rally as U.S. dollar extends losses
0
29


Article content

Gold prices climbed more than 1% to their highest levels in a week on Tuesday and other precious metals also rallied on the back of a sliding dollar, as markets remained focused on the Federal Reserve’s interest rate strategy.

Spot gold jumped 1.7% to $1,817.00 per ounce by 12:02 p.m. ET (1702 GMT). U.S. gold futures rose 1.6% to $1,826.90.

Article content

The yen surged to a four-month peak against the dollar after the Bank of Japan stunned markets by deciding to review its yield-curve control policy.

Article content

Weaker housing data lead to flight-to-safety buying in the precious metals, which along with the decision from the Bank of Japan, was the “perfect storm” this morning, said Bob Haberkorn, senior market strategist at RJO Futures.

Bullion has shed more than $260 an ounce since its March peak as central banks stepped up efforts to fight soaring inflation, but is enjoying its best quarter since early 2020, up 9.5% so far.

Fed Chair Jerome Powell last week said the U.S. central bank will deliver more rate hikes next year even as the economy slips towards a possible recession.

“I see that it’s going to be a dark shadow on the gold market, but I still think we’re headed for an upside,” said Jeffrey Sica, chief executive officer of Circle Squared Alternative Investments, referring to the prospect of the Fed continuing to raise rates.

Higher interest rates increase the opportunity cost of holding bullion that pays no interest.

Top consumer of bullion China was grappling with surging COVID-19 cases, and the World Bank cut its growth outlook for this year and the next.

Spot silver climbed 4.7% to $24.03 per ounce, posting its biggest intraday gain since early November.

Platinum was up 2.8% to $1,006.75 while palladium gained 3.2% to $1,722.85. (Reporting by Seher Dareen in Bengaluru; Editing by Paul Simao and Krishna Chandra Eluri)



Source link

Load More Related Articles
Load More By 
Load More In Business
Comments are closed.

Check Also

China’s Jan factory activity contracts at slower pace amid COVID infections – Caixin PMI

Article content BEIJING — China’s factory activity shrank more slowly in January after Bei…