Sudden spikes? Yes, please! Gold is above $1,800, finally!
Gold dives amid strengthening US currency
On Thursday, gold tumbled in the face of a stronger US currency, getting closer to a six-month minimum because the Fed Chair officially confirmed an outlook for higher interest rates in America.
As a matter of fact, August delivery gold futures went down by 0.56% on the Comex exchange offering a result of $1,267.40 a troy ounce.
Closely watching the purchasing potential of the US currency relative to its six key rivals, the USD index showed 94.92, soaring by up to 0.15%.
It’s apparent that greenback-denominated assets, including the precious yellow metal, turn out to be very sensitive to any changes in the value of the US currency. A soar in the value of the US dollar makes gold less affordable for those investors who keep foreign currencies, and it diminishes demand for the number one precious commodity.
In addition to this, long-term Treasury revenues managed to revive from three-week minimums on Wednesday, backing the evergreen buck’s leap on Thursday.
On Wednesday, Fed Chair Jerome Powell told that the US key financial institution should proceed with its gradual policy of rate hikes, and this statement backed yields. During a gathering of key bank chiefs in Portugal he pointed out that trade tensions could seriously damage the world’s economy.
On Thursday, American leader Donald Trump told that he’s on the verge of announcing fresh trade deals with some unspecified countries in the nearer future.
Previously, on Monday, Donald Trump urged the US Trade Representative to identify $200 billion worth of China’s goods for extra duties. It’s evident that the news provoked a sell-off in shares and it was cited as a sort of support for gold prices.
As for other precious commodities, silver futures went down 0.52% being worth $16.225 a troy ounce, platinum futures sagged by 0.84% coming up with $863.40 an ounce.
Read a short market wrap before trading today!
The United States will publish the non-farm employment change, also known as non-farm payrolls or NFP at 15:30 MT (GMT+3) time on August 6.
Our analyst discusses the latest news and shares his trade ideas on gold, EUR/USD, and S&P 500. Jump in!