Breaking News
0

PRECIOUS-Gold prices edge higher as global stocks sag, U.S. dollar slips

CommoditiesOct 10, 2018 17:08
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. PRECIOUS-Gold prices edge higher as global stocks sag, U.S. dollar slips

* Global equities slide to three-month lows

* U.S dollar retreats from seven-week high

* Prospects of further U.S. rate hikes limit gold's gains

* Silver slips to near two-week lows (Updates prices, adds details)

By Swati Verma

BENGALURU, Oct 10 (Reuters) - Gold prices edged higher on Wednesday as some investors sought refuge in the precious metal after the global stocks tumbled and the U.S. dollar weakened.

Spot gold XAU= rose 0.4 percent to $1,194.12 per ounce by 4:52 p.m. EDT (2052 GMT). U.S. gold futures GCv1 settled up $1.9, or 0.16 percent, at $1,193.4.

Stocks on major world markets fell to a three-month low, with the benchmark S&P500 stock index falling more than 3 percent, in its biggest one-day fall since February. The U.S. dollar index retreated from a seven-week peak hit in the previous session. MKTS/GLOB USD/

"The S&P500 is looking very weak and negative and that is putting fear into investors," said Michael Matousek, head trader at U.S. Global Investors.

"With the markets going down people are increasing their allocation towards gold."

Gold, however, has fallen over 13 percent since hitting a peak in April, with investors increasingly opting for the safety of the greenback as the U.S.-China trade war unfolded against a backdrop of rising U.S. interest rates.

Rising bond yields have also dampened the appeal of gold, which pays no interest. Higher U.S. Treasury yields can translate into more demand for the dollar, making bullion more expensive for holders of other currencies.

"The higher yield environment and stronger dollar are providing a toxic mix for gold," said Fawad Razaqzada, an analyst with Forex.com.

"The trend for yields has been bullish and they could rise further from here. It will be hard for gold to sustain any rallies in this environment."

U.S. Treasury yields held near multi-year highs after government data showed the U.S. producer price index (PPI) climbed in September, which reinforced expectations that the Federal Reserve would continuing raising interest rates. US/ prices will struggle to rebound over the remainder of 2018," said Sabrin Chowdhury, commodities analyst at Fitch Solutions.

"Strong U.S. economic growth, concurrent monetary policy normalisation by the U.S. Federal Reserve and a strong dollar will all limit the attractiveness of holding gold as an investment."

The Fed increased interest rates last month for the third time this year and is widely expected to hike again in December, with no suggestion its tightening policy will cease anytime soon.

Analysts said an upside in gold could also be limited by waning demand due to depreciating domestic currencies in major gold-consuming countries such as India. silver XAG= lost half a percent at $14.29, earlier touching its lowest since Sept. 28 at $14.21.

Palladium XPD= fell 0.5 percent to $1,064.22 and platinum XPT= slipped 0.2 percent to $822.20 an ounce.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ GRAPHIC-India gold vs spot gold

https://reut.rs/2OljQYv

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

PRECIOUS-Gold prices edge higher as global stocks sag, U.S. dollar slips
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email