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Gold ascends on safe-haven demand
On Thursday, gold surged in mid-morning trade because the safe-haven metal finally caused buyer interest in the face of US-China trade fears, while a weaker-than-anticipated result on job creation also assisted to soothe concerns over a faster tempo of rate lifts from the key US bank.
December delivery gold futures rallied by 0.70% on the Comex exchange being worth $1,210.60 a troy ounce.
Estimating the greenback’s purchasing power versus its key rivals the USD index dipped by 0.16% being worth 94.92.
Apparently, the softer greenback backed gold, although markets’ focus was still centered on the US - China trade clashes against the backdrop of worries that an escalation could be inevitable.
American leader could impose duties on an extra $200 billion worth of China’s products when a public consultation period is over.
China has warned that it’s going to adequately respond if America slaps fresh levies on its products.
The private payroll processor ADP informed that in August America generated just 163,000 jobs, which is quite below the 191,000 positions anticipated in the official government data out Friday.
The worse-than-anticipated outcome assisted to relieve fears that the major US bank could take a more hawkish stance on policy tightening.
Financial markets already expect the key US bank to have interest rates lifted by a quarter point at the next policy gathering on September 25-26.
Higher interest rates tend to put pressure on demand for the number one precious commodity. It definitely backs yield-bearing investments.
As for other metals, silver futures managed to rally by 0.28% hitting $14.260 a troy ounce.
Besides this, palladium futures managed to rally by up to 0.53% being worth $960.70 an ounce. As for platinum futures, they gained 1.12% demonstrating $793.10.
As for copper, this commodity jumped by 1.57% coming up with $2.651 a pound.
The market optimism waned amid stricter restrictions to control rising coronavirus infections. S&P 500 and Nasdaq dropped from the all-time highs, while the USD jumped higher.
S&P 500 skyrocketed to the all-time high on optimism that Biden’s fiscal stimulus will support economic growth and boost corporate earnings.
PMI reports from the EU, the UK, and the USA will be released during the day!