Gold prices fall as the US currency rises

  • 15 October, 2021
  • 2:39 pm EEST

Gold prices fell, during trading on Friday, affected by the rise in the dollar index.

The decline came after gold prices crossed the $1800 barrier during Thursday’s trading, and the precious metal rose for the third consecutive session at the end of yesterday’s trading, supported by the dollar’s decline and the decline in US bond yields.


Gold Prices

The price of gold futures contracts -December delivery- fell by 0.76%, to record 1784.20 dollars an ounce, by 10:00 AM GMT (1:00 PM Mecca time).

The price of the spot delivery of the yellow metal decreased by 0.71%, recording 1783.14 dollars an ounce.


Metal Prices

Among other precious metals, the price of silver futures – for December delivery – decreased by 0.58%, to reach the level of $23.34 an ounce.

The spot platinum price also fell by 0.21%, recording $1,057.25 an ounce.

Meanwhile, the dollar index – which follows the performance of the US currency against a basket of 6 major currencies – rose by 0.01% to 93.9530 points.


Gold Stability

AirGuide Consulting Director Michael Langford ruled out a rise in gold prices next week, noting that the yellow metal is heading to stabilize around the $1800 level.

He also lowered the expectations of the Federal Reserve raising interest rates soon, indicating that the closest to the reality is the commitment to raise them on the date indicated earlier.

He pointed out that the flow of circulating funds can contribute to supporting the rise in asset prices, in the coming months, including gold prices.

Update – gold prices continue to rise for the third consecutive session
Update – gold prices rise $ 35, recording the highest level in a month

Policymakers at the Federal Reserve disagreed about the measures to be taken in the face of the inflation crisis, while they agreed that the central bank could start reducing monthly bond purchases, during the next month.

A report – issued after a strong increase in consumer prices – revealed that US producer prices were less than their 9-month gains last September, according to Reuters.


Interest Rate

Analysts at ANZ Research confirmed that the prices of the precious metal are facing pressure, noting at the same time that gold is facing pricing less than its value by about $150, with expectations of “temporary” increases in inflation pressure.

Gold is seen as a hedge against inflation, but lower stimulus and higher interest rates push up government bond yields, raising the opportunity cost of holding gold.

Strong US corporate earnings are easing concerns about rising inflation risks, boosting investor sentiment as gold is a safe haven.

At the same time, gold prices failed to stabilize above the $1800 level, which pushed gold prices lower.

Investors are waiting for US consumer-focused data, until a decisive move appears in gold prices.

According to “Technical Communications Detector”, gold prices are trying to maintain their recent high gains, without the ability to continue rising, and prices remained around the levels of $ 1798, which is a difficult level to break, according to FX Street.

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