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Gold price hits more than one-week peak as dollar and yields slip

Gold prices rose on Tuesday to their highest level in more than a week as a weaker dollar and pullback in US bond yields lifted demand for the safe-haven metal

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Gold Prices | Precious metals | US Dollar

Reuters 

Gold price hits more than one-week peak as dollar and yields slip
Gold bricks

By Diptendu Lahiri

(Reuters) - climbed to their highest in more than a week on Tuesday as a weaker dollar and a drop in U.S. boosted demand for the metal.

Spot gold was up 0.1% at $1,730.46 an ounce by 0703 GMT after touching its highest since March 25 at $1,737.35.

U.S. gold futures rose 0.1% to $1,731.10.

"The strong U.S. economic data have eased concerns and have softened the dollar as a safe-haven asset, and gold is being supported because of that," said Michael McCarthy, chief market strategist at CMC

The dollar slumped to an almost two-week low against a basket of rival currencies, making gold cheaper for buyers outside the United States.

Benchmark U.S. Treasury yields slipped, moving further away from a 14-month peak hit last week, reducing the opportunity cost of holding non-yielding gold.

Better than expected recent economic readings out of the United States, meanwhile, have lifted hopes of swift recovery and drove investors towards riskier assets.

"Gold has formed a short-term double bottom but needs to break above $1,750 before it can head higher," Stephen Innes, chief global market strategist at financial services firm Axi, said in a note.

"The metal could struggle to extend last week's recovery with the positive U.S. non-farm payroll data underpinning risk-on sentiment."

The U.S. economic outlook is brightening, Cleveland Federal Reserve Bank President Loretta Mester said on Monday, adding that the Federal Reserve should stick to its easy monetary policy to help to support growth further.

"The coordinated approach of central banks has kept gold supported for quite some time and that's what we are also seeing today," CMC's McCarthy said.

Elsewhere, silver fell 0.1% to $24.88 an ounce while palladium rose 0.3% to $2,671.97 and platinum edged 0.1% down to $1,207.43.

 

(Reporting by Diptendu Lahiri in Bengaluru; Editing by Shailesh Kuber and David Goodman)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Tue, April 06 2021. 15:24 IST
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