News

Gold prices are marginally declining and heading to record monthly and quarterly losses

  • 30 June, 2022
  • 3:32 pm EEST

Gold prices marginally declined during trading today, Thursday, June 30, 2022, and are heading to record the worst quarterly performance since early 2021.

The strong performance of the dollar has kept investors away from bullion, amid moves by major central banks to adopt strict tactics to fight inflation.

 

Gold Prices Today

The price of gold futures contracts – August delivery – decreased by 0.81%, to reach the level of $ 1803 an ounce.

Yesterday, Wednesday, gold prices ended down trading for the third consecutive session, with the US dollar rising.

The price of spot delivery of the yellow metal also fell by 0.19%, to reach $ 1812.29 an ounce.

It is expected that gold prices will decline for the third month in a row, to record losses of about 6.2% during the second quarter of 2022.

The price of silver futures contracts – for July delivery – decreased by 1.32% at $20.49 an ounce, according to data seen by the specialized energy platform.

The spot platinum price decreased by 2.74%, to record $888.86 an ounce, in contrast, the spot palladium price decreased by  2.85%, at $1890.94 an ounce.

 

Dollar Rise

Matt Simpson, chief market analyst at City Index, said a combination of rising returns and the US dollar played their part in gold’s underperformance.

Simpson noted that gold priced in other currencies wasn’t too bad, Reuters reported.

The US dollar is hovering near its last peaks in two decades and could post its best quarterly performance in more than 5 years; This makes gold priced in US currency more expensive for buyers holding other currencies.

 

Central Bank Moves

The world’s top central bank officials said on Wednesday that bringing down soaring inflation around the world would be painful and could lead to a collapse in growth, but it must be done quickly to prevent rapid price growth from becoming entrenched.

Higher bond yields and higher interest rates by central banks to combat inflation increase the opportunity cost of holding bullion, which does not pay any interest.

 

Gold Market

Gold’s performance in the second quarter erased the gains made earlier in the year; The escalating conflict between Ukraine and Russia has driven up demand for the safe haven, with prices back around 2022 levels at just over $1,800.

Looking to the future, the bias will become increasingly bearish as interest rates continue to rise and inflation expectations are reduced, said DailyFX Currency Analyst, Ilya Spivak.

He added that between 1780 and 1790 dollars an ounce is an important support level

 

 

 

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