Gold prices edged higher

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Gold bars

Gold prices moved up on Monday as continuing fears over the fate of debt-laden property behemoth China Evergrande and its broader implications bolstered the precious metal’s safe-haven appeal. Spot gold increased 0.5 percent to $1,757.79 per ounce by 0127 GMT. The U.S. gold futures were up 0.3 percent at $1,757.30.

Asian shares got off to a cautious start on Monday amid a surge in oil prices and worries about the Evergrande issue, after the Chinese business skipped a payment on offshore notes last week. Further metal gains were restricted as benchmark 10-year Treasury rates reached their highest since early July. Raising the potential cost of holding non-interest-bearing gold.

A pair of Federal Reserve policymakers said they felt the U.S. economy is already in good enough form for the central bank to begin to reduce assistance for the economy.

Fed Chair Jerome Powell is scheduled to testify before Congress this week. He will address the central bank’s policy response to the outbreak.

Gold demand

Physical gold demand is high in the top consumer. China increased last week as purchasers sought shelter from the potential consequences of the Evergrande issue, as well as other factors such as seasonal increase inactivity.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, reported its holdings grew 0.1 percent to 993.52 tons on Friday from 992.65 tons on Thursday. Speculators reduced their net-long positions in COMEX silver by 13,178 contracts to 900 in the week ending September 21. The price of silver increased by 0.9 percent to $22.61 per ounce.

Platinum increased by 1% to $992.00, while palladium increased by 0.1 percent to $1,973.47.

 

Brent crude

Brent crude was up $1.15, or 1.5 percent, to $79.24 a barrel by 0900 GMT. Gaining for three weeks in a row. Oil in the United States rose $1.07, or 1.5 percent, to $75.05, approaching its best since July, after gaining for the sixth week in a row last week.

Goldman Sachs boosted its Brent crude projection for the end of the year to $90 per barrel. They are citing speedier fuel demand recovery from the Delta strain epidemic and Hurricane Ida’s impact on U.S. output. Caught off guard by the demand resurgence, members of the Organization of Petroleum Exporting Countries and their allies, known as OPEC+, have struggled to increase output as under-investment or maintenance delays from the epidemic persist.

Price support came from tightening supply in the United States as problems in Mexico prompted inventory reductions. Gains in the broader energy complex also boosted the European crude benchmark, he added. Rising natural gas costs fueled speculation that it would increase demand for alternative fuels, particularly oil.

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