Gold firms as dollar slides and Covid-19 jitters linger
The greenback index moved away from a multimonth high, lifting bullion’s allure for holders of other currencies
23 August 2021 - 07:29
byEileen Soreng and Brijesh Patel
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Bengaluru — Gold prices edged higher on Monday after the US dollar retreated from multimonth highs, while investor concerns that the Delta coronavirus variant could dampen the global economic recovery also lifted bullion’s safe-haven appeal.
Spot gold was up 0.4% at $1,787.48 per ounce at 6.03am, while US gold futures were up 0.3% at $1,788.80.
The dollar index was down 0.2%, moving away from the 9½-month high hit last week, lifting gold’s allure for holders of other currencies.
“The Delta variant is throwing sort of a spanner into the works on how likely and how soon we could see a tapering announcement,” ING analyst Warren Patterson said.
Dallas Federal Reserve president Robert Kaplan, a strong supporter for tapering stimulus, said on Friday he may need to adjust that view if the Delta variant slows economic growth materially.
In the clearest sign yet of the impact of the Delta variant on the Federal Reserve’s plans, Covid-19 restrictions have prompted the US central bank to schedule its annual economic symposium in Jackson Hole, Wyoming on Aug 27 virtually and not in person as planned.
Chair Jerome Powell is expected to give a speech at the event on the economic outlook.
Gold’s advance has thus far been capped largely by concerns over the Fed’s tapering, OCBC analysts said in a note.
“We expect gold to continue trading within a broad sideways trend of $1,750-$1,800 for now, though our near-term bias is to the upside.”
Highlighting the heavy toll from the recent surge in infections, Japan’s factory activity growth slowed in August, while that of the services sector shrank at the fastest pace since May last year.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.3% to 1,011.61 tonnes on Friday.
Elsewhere, silver rose 0.8% to $23.20 per ounce, while platinum firmed 1.8% to $1,014.28.
Palladium climbed 1.7% to $2,313.88, bouncing off a more than five-month low hit earlier in the session.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Gold firms as dollar slides and Covid-19 jitters linger
The greenback index moved away from a multimonth high, lifting bullion’s allure for holders of other currencies
Bengaluru — Gold prices edged higher on Monday after the US dollar retreated from multimonth highs, while investor concerns that the Delta coronavirus variant could dampen the global economic recovery also lifted bullion’s safe-haven appeal.
Spot gold was up 0.4% at $1,787.48 per ounce at 6.03am, while US gold futures were up 0.3% at $1,788.80.
The dollar index was down 0.2%, moving away from the 9½-month high hit last week, lifting gold’s allure for holders of other currencies.
“The Delta variant is throwing sort of a spanner into the works on how likely and how soon we could see a tapering announcement,” ING analyst Warren Patterson said.
Dallas Federal Reserve president Robert Kaplan, a strong supporter for tapering stimulus, said on Friday he may need to adjust that view if the Delta variant slows economic growth materially.
In the clearest sign yet of the impact of the Delta variant on the Federal Reserve’s plans, Covid-19 restrictions have prompted the US central bank to schedule its annual economic symposium in Jackson Hole, Wyoming on Aug 27 virtually and not in person as planned.
Chair Jerome Powell is expected to give a speech at the event on the economic outlook.
Gold’s advance has thus far been capped largely by concerns over the Fed’s tapering, OCBC analysts said in a note.
“We expect gold to continue trading within a broad sideways trend of $1,750-$1,800 for now, though our near-term bias is to the upside.”
Highlighting the heavy toll from the recent surge in infections, Japan’s factory activity growth slowed in August, while that of the services sector shrank at the fastest pace since May last year.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.3% to 1,011.61 tonnes on Friday.
Elsewhere, silver rose 0.8% to $23.20 per ounce, while platinum firmed 1.8% to $1,014.28.
Palladium climbed 1.7% to $2,313.88, bouncing off a more than five-month low hit earlier in the session.
Reuters
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