Gold, silver ease as dollar holds firm near two-month peak, hopeful aid




By Sumita Layek


(Reuters) – Gold and fell on Thursday as a firmer dollar dented their appeal, while investors look forward to the passage of a massive stimulus package in the United States and the Bank of England’s interest rate decision.



Spot gold dropped 0.6% to $1,822.01 per ounce by 0330 GMT. U.S. gold futures fell 0.6% to $1,823.90.


Spot silver declined 1.3% to $26.51. Prices have eased since hitting a near eight-year peak of $30.03 on Monday as the social media-driven rally fizzled out.


“The major driver across is the strengthening of dollar. The moves in silver have been largely speculation and it’s becoming apparent that does not have a lasting effect,” said Michael McCarthy, chief market strategist at CMC


The dollar hovered close to a two-month peak it hit on Wednesday, while benchmark 10-year Treasury yields rose to its highest in over three weeks. [USD/] [US/]


“The rise in yields is telling us the central banks are working on how they will lift the interest rates and withdraw stimulus rather than the other way round,” McCarthy said.


Gold benefits from an easy monetary policy as it weighs on government bond yields.


A recent surge in crypto currencies has also stolen some shine from gold.


Investors now await the Bank of England policy decision due at 1200 GMT.


Focus also remained on a $1.9 trillion U.S. coronavirus aid plan, which was pushed by the U.S. House without Republican support.


“The biggest risk to gold is stronger recovery as vaccines rollout, to the extent that we see U.S. bond yields rally,” said Lachlan Shaw, National Australia Bank’s head of commodity research.


“Having said that, if the vaccine rollout faces uncertainty, with these new emerging strains, that can still be supportive for gold.”


Platinum fell 1.4% at $1,085.62 an ounce and palladium lost 1.1% to $2,250.06.


 


(Reporting by Sumita Layek in Bengaluru; Editing by Krishna Chandra Eluri)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor





Source link