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Gold inches down on strong equities, higher US Treasury yields

Gold inches down on strong equities, higher US Treasury yields

January 10, 2018

 

Spot gold dipped 0.3% to $1,309.26 an ounce by 0049 GMT. Prices fell 0.6% on Tuesday.

 

Gold prices edged lower for a second session early on Wednesday, as a rally in equities and a surge in US treasury yields dented bullion's safe-haven appeal.

 

Fundamentals

 

Spot gold dipped 0.3 per cent to $1,309.26 an ounce by 0049 GMT. Prices fell 0.6 per cent on Tuesday, its biggest one-day loss in a month.Last week, prices touched their highest since Sept. 15 at $1,311.40

 

US gold futures were down 0.2 per cent at $1,318.10 an ounce.The dollar index, which tracks the greenback against a basket of six major rival currencies, was steady at 92.517. It touched over 1-week highs at 92.640 on Tuesday.

 

Benchmark US Treasury yields hit a 10-month high on Tuesday after the Bank of Japan tweaked its bond-buying program, while stocks in world indexes continued their flying start to the year.

The S&P 500 and Nasdaq have hit records every trading day of the new year, or the past six sessions, providing optimism on the outlook for the rest of the year.

 

The U.S. Federal Reserve should keep interest rates low so that wage gains accelerate and inflation rises, Minneapolis Federal Reserve President Neel Kashkari said on Tuesday.

Investors are betting on further US interest rate hikes after Friday's payrolls data did nothing to challenge the outlook for monetary policy tightening by the US Federal Reserve.

 

Palladium recorded its life-time high on Tuesday at $1,111.40 an ounce, boosted by increased demand from the automotive industry. It was steady at $1,098.97 on Wednesday.Holdings of SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, fell 0.35 per cent to 831.91 tonnes on Tuesday from 834.86 tonnes on Monday.

 

A South African tribal leader has agreed to a more transparent structure for a 175 million rand ($14 million) community trust funded by Anglo American Platinum (Amplats), a move that aims to curb unrest around the firm's most profitable mine.

 

Source: https://economictimes.indiatimes.com/m