News

Gold prices rise $5 as US bond yields fall

  • 06 June, 2022
  • 3:16 pm EEST

Gold prices rose about $5, during trading today, Monday, June 6, 2022, supported by a slight decline in the dollar price and US Treasury bond yields.

This comes despite the fact that the outlook for the yellow metal has been subject to sharp increases in interest rates by central banks.

 

Gold Prices Today

The price of gold futures contracts for August delivery increased by 0.31%, equivalent to $5.70, to reach the level of $1856.90 an ounce.

Gold prices fell by more than $21, at the end of trading last Friday, recording the largest daily decline in 3 weeks, after the release of the monthly jobs report in America, but the yellow metal recorded slight weekly losses by 0.05%.

The price of immediate delivery of the yellow metal also rose by 0.13%, to reach $1,853.61 an ounce, according to data seen by the specialized energy platform.

On the other hand, the price of silver futures contracts – July delivery – jumped by 2.24%, at $22.41 an ounce.

The spot platinum price rose by 1.43%, at $ 1031.57 an ounce, and the spot palladium price rose 2.29%, at $ 2012.14 an ounce.

 

Gold Market Situation

Gold is still trading below last week’s highs, with prices down nearly 1% on Friday, after data showed that US employers hired more workers than expected in May and maintained a fairly solid pace of increase. wages.

A strategic market analyst at IG said, Yip Jun Rong, “Following the release of the latest US jobs report, market participants will remain highly sensitive to any signals on central bank policy expectations, with guidance from the Australian Reserve and the European Central Bank on watch this week, along with key US CPI data. “.

Friday’s US CPI data will be the next focus for further indications about the Fed’s tightening path.

 

Interest Rates

The US Federal Reserve is on track to raise rates by half a point at its June-July policy meetings, and Friday’s jobs report raised the possibility of a rate hike even after that.

Investors have also upped their bets on the European Central Bank’s rate hikes this year, priced in a larger 50 basis point increase at one of the ECB’s policy meetings, by October.

Higher rates raise the opportunity cost of holding gold, which does not result in interest.

John Rong added that higher oil prices did not provide much comfort on the inflation front, which led to the risks of persistent inflation pressing central banks to tighten more aggressively.

 

 

 

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