Gold price rallies to weekly high as both dollar, yields dip
Gold prices rallied to their highest in over a week on Thursday as a slide in both the dollar and Treasury yields reignited the metal’s safe-haven appeal.
Spot gold shot up 1.4% to $1,842.78 per ounce by 12:20 p.m. ET, while US gold futures gained 1.3%, trading at $1,840.30 per ounce in New York.
[Click here for an interactive chart of gold prices]
Meanwhile, the US dollar slid 1% and yields dropped to a three-week low, making bullion cheaper for overseas buyers.
“Dollar is falling and yields are significantly lower and this is good news for gold,” Edward Moya, senior analyst with OANDA, told Reuters.
After hitting a near four-month low earlier this week, gold is now up about 3% since the dollar backtracked from 20-year highs.
Further adding sparkle to the metal, Wall Street’s main indexes opened lower on concerns over the impact of surging inflation on the economy and corporate earnings.
Compounding the economic concerns are the latest US employment data, which showed that jobless claims unexpectedly rose last week, and the figure is now sitting at its highest in four months.
“Gold is attracting safe-haven flows as the focus has shifted to the weakness in the US with jobless claims rising and all the negative talk about inflation. There is good amount of pessimism with regards to global stocks,” Moya added.
The recent retreat in gold prices has helped its appeal among investors as they continue to seek safety from riskier assets and hedge against inflation, Fawad Razaqzada, market analyst at City Index, wrote in a note.
(With files from Reuters)