Gold futures on Wednesday marked their highest finish in over a week, with prices holding above the key $1,700 mark to recoup their loss from a day earlier and then some.
Worries about slowing global growth have helped precious metals find some support, but overall strength in the U.S. dollar constrained gains.
Price action
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Gold
GCZ22,
-0.49% for December delivery settled at $1,727.80 per ounce on Comex, up $14.90, or 0.7%. Based on the most actively traded contract, prices, which lost 0.6% on Tuesday, settled at their highest since Aug. 30, FactSet data show. -
December silver
SIU22,
+0.95% rose 35 cents, or 2%, to $18.26 per ounce. -
December palladium
PAZ22,
+5.42% rose $49.60, or 2.5%, to $2,022.80 per ounce, while platinum futures PLV22,+2.83% for October delivery added $13.30, or 1.6%, to $847.20 per ounce. -
December copper futures
HGZ22,
+3.48% were down 3 cents, or 0.9%, at $3.4305 per pound.
What analysts are saying
Rupert Rowling, a market analyst at Kinesis Money, said expectations for slowing growth in China were helping to keep gold and silver above critical support levels.
“It is hard to see how gold can make any gains given such a hawkish environment yet there clearly remains some underlying support for the metal that is at least enabling it to hold around the key threshold of $1,700,” he said.
The ICE U.S. Dollar Index
DXY,
“If the recent dynamic of rising rates, a firming dollar, and fading inflation expectations continues, it is only a matter of time until gold breaks down through the bulls’ ‘line in the sand’ at $1,680 and hits new lows for the year,” analysts at Sevens Report Research wrote in Wednesday’s newsletter.
The Federal Reserve may be on track to raise interest rates by another 75 basis points this month amid Fed Chairman Jerome Powell’s pledge to reduce inflation, The Wall Street Journal reported Wednesday.
Also see: Fed’s Mester sees growth ‘well below’ 2% rate this year and next
Prices for gold were little changed from the day’s settlement Wednesday afternoon, shortly after the release of the Fed’s Beige Book, which said the “outlook for futures economic growth remained generally weak.” In electronic trading, December gold was at $1,727.40.
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