Gold futures ended Friday lower, pulling back on two consecutive days of gains, with prices recording their first weekly drop in 10 weeks thanks to the recent strength of US Treasury yields.
Chris Gaffney, president of World Markets at TIAA, said: The week begins with gold trading in record territory, but will end with “a number of factors that affect gold prices”. Bank. The higher interest rate on government debt is attributed to some soft, unproductive gold factor.
10-year Treasury Bond yield TMUBMUSD10Y,
on Thursday hit an eight-week high. In Friday trading, it was trading at 0.693% compared to 0.562% last Friday.
Gold̵7;s “carry-on cost” of gold is negative in the current environment because investors don’t sacrifice interest rates to carry assets as hard as gold, Gaffney told MarketWatch.
Gold December GCZ20,
withdrew to 20.60 USD, or nearly 1.1%, down to 1,949.80 USD / ounce, after increasing 1.1% on Thursday. According to FactSet data, gold has seen a weekly drop of around 3.9%, based on the settlement transaction of the most active contract last Friday, marking a nine-week winning streak, according to FactSet data. On Tuesday, futures prices suffered the largest daily decline in the dollar since April 15, 2013.
Meanwhile, the September silver price SIU20,
down $ 1.63, or 5.9%, to $ 26,089, after rising 6.7% a day ago. Silver losses 5.3% weekly.
‘If a word could be used to describe gold’s price action this week, the most relevant thing would be’ madness’. ”
“If one word can be used to describe gold’s price action this week, the most relevant thing would be ‘madness’,” said Lukman Otunuga, senior market analyst at FXTM.
“After experiencing a stressful profit-taking session at the beginning of the week … precious metals are trading back above $ 1,950,” he said.
“Investors are still attracted to the precious metal due to US-China tensions, the US stimulus deadlock, and the unpopular US dollar.”
Investors on Thursday also analyzed economic reports in the US to help assess the impact of the COVID-19 pandemic on the national economy. A report of US retail sales rose 1.2% in July, weaker than forecast.
US retail sales ignored expectations, “a sign that the global recovery is slowing,” Gaffney said. “This is why vaccines are so important. Consumers will not feel completely confident to travel and spend until they feel safe from the virus.
The US sales report comes after China’s retail sales fell 1.1% in July, compared with expectations for the unchanged results.
Separately, a report of US productivity grew at an annual rate of 7.3% in the second quarter, well above the 1.4% expectation, based on median estimates from economists. by MarketWatch. Industrial production rose 3% from expected in July, the third consecutive month of increase.
Gaffney said in the near future, gold traders will continue to monitor the “possibility of a” second wave “of viruses across Europe and Asia, as well as interest rates, as gold will benefit if interest rates are low. Traders will also follow the discussion of stimulus and the resulting debt levels, he said.
Among other metals traded on the Comex on Thursday, September HGU20 copper,
up nearly 1.9% to $ 2,859 / pound, up 2.4% weekly. October Platinum PLV20,
down 2.4% to $ 959.10 / ounce, 1.2% loss for the week, and September palladium PAU20,
lost 3.3% to 2,143.80 USD / oz – down 1.5% compared to the end of last week.