On Tuesday, gold prices edged up in Asia with the greenback in concentration as it mildly retraces sharp increase in the previous month on the surprise victory of U.S. president-elect Donald Trump and extensive expectations for a Fed rate hike in December.
Delivery of gold for December increase 0.10% to $1,192.00 a troy ounce on the Comex division of the New York Mercantile Exchange. Additionally, silver futures increased 0.29% to $16.723 a troy ounce, although copper futures increased 0.49% to $2.672 a pound.
Suddenly, on Monday, gold prices increase more than 1%, recovering from nine and a half month lows as the greenback reversed some of its post U.S. election gains after surging to approximately 14-year peak the previous week.
On Friday, the greenback slipped lower as traders took gains of the holiday-shortened week to take profits after a powerful rally pushed it to the highest level since April 2003.
On Monday, greenback selling restarted as investors looked forward to possibly risky events just like Wednesday’s OPEC meeting and Italy’s approaching constitutional referendum on December 4, which could see the government resign. Investors were also looking forward to a raft of U.S. economic data this week, including Friday’s nonfarm payrolls report for November.
Gold is priced in dollars and becomes more striking to holders of other currencies when the dollar decreases.
Prices of the yellow metal have declined approximately 6% so far this month on expectations that increased U.S. fiscal spending under a Trump administration will spur economic progress and inflation, which would eventually lead to an era of higher interest rates.
Gold is sensitive to change in U.S. rates, which boost the opportunity cost of holding non-yielding assets like bullion, while increasing the dollar in which it is priced.
On Additional News
On Tuesday, crude prices decline in Asia as wrangling by the Organization of Petroleum Exporting Countries (OPEC) members over the information of a proposed production curb continues.
U.S. crude oil declines 0.76% to $46.72 a barrel on the New York Mercantile Exchange. Global benchmark Brent futures plunged 0.85% to $48.78 a barrel.
Later on Monday, experts from OPEC nations was unsuccessful to reach a negotiation on the information to curb production by country, building up a bleak outlook for a final arrangement when a full meeting begins on November 30, according to the reports.
Additionally, on Monday, Algerian and Venezuelan oil ministers traveled to Moscow in a final effort to motivate Russia to take part in reductions instead of just freezing production.
Later on Tuesday, the American Petroleum Institute will post its estimates of U.S. crude and refined product inventories at the end of last week. The figures are followed on Wednesday by more closely observed official statistics from the U.S. Department of Energy.
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