Gold prices extend gains
Thursday, 17 October 2024
Gold prices extended gains to a second straight session on Wednesday, driven by weaker equities and bond yields, while traders eagerly await U.S. economic data to gauge the Federal Reserve's timeline on a potential interest rate reduction reports Reuters.
Spot gold was up about 0.7 per cent at $2,678.70 per ounce, as of 7:43 a.m. EDT (1143 GMT), and trading about $7 below a record high of $2,685.42 scaled last month. U.S. gold futures gained 0.6 per cent to $2,695.30.
"Seems the gold market wants to see a record high, with prices marginally below the late-September record high with support coming from a slightly risk-off environment with equities down," UBS analyst Giovanni Staunovo said.
Safe-haven bullion tends to be a preferred investment in a low interest rate environment and during economic and geopolitical turmoil.
"The uncertainty surrounding U.S. elections and geopolitical tensions will also support gold going forward," said Soni Kumari, a commodity strategist at ANZ.
The benchmark 10-year US Treasury note yields slipped to more than a one-week low, making non-yielding gold more attractive.
Market participants will be keeping a keen eye on the release on Thursday of U.S. retail sales, industrial production and weekly jobless claims data.
Gold needs stronger-than-expected data to change the rate-cut trajectory, but this should still boost investment demand and drive prices to a record high in the coming months, UBS' Staunovo said.
Wall Street's main indexes closed lower on Tuesday, as chip stocks tumbled and the energy sector slid along with oil prices.
San Francisco Fed President Mary Daly said the US central bank remains on track for more reductions in borrowing costs this year as long as data meets expectations.
Delegates at the London Bullion Market Association's annual gathering predicted gold prices would rise to $2,941 per ounce over the next 12 months and silver prices would jump to $45 per ounce.
Spot silver rose 1.2 per cent to $31.85. Platinum was up 0.7 per cent to $991.24 and palladium gained 0.6 per cent to $1,015.75.
The Guangzhou Futures Exchange (GFEX) will launch platinum and palladium futures in the first quarter of 2025, according to the producers' council.