https://www.engineeringnews.co.za

Gold heads for weekly loss on strong US economic data

28th July 2023

By: Reuters

  

Font size: - +

Gold regained some ground on Friday as the dollar retreated, but still headed for its worst week in five after data pointing to a resilient US economy soured bets for a dovish tilt in US monetary policy.

Spot gold rose 0.6% to $1 956.69 per ounce by 11:33 GMT, up from its lowest since July 12. US gold futures GCcv1 gained 0.5% to $1 955.70.

Bullion headed for a 0.2% weekly drop, logging its biggest daily decline on Thursday after data showed faster-than-expected US gross domestic product growth in the second quarter.

The data contributed to an increase in expectations on how long US interest rates will remain high, fuelling the rise in the dollar and, in turn, the sharp fall in gold, said Edward Gardner, commodities economist at Capital Economics.

Higher interest rates and Treasury bond yields raise the opportunity cost of holding non-yielding gold. 

But the European Central Bank, while delivering its ninth consecutive interest rate hike on Thursday, also raised the possibility of a pause in September.

"Overall, a dovish ECB should have represented positive news for gold. But in this case, it generated a quick rally of the U.S. dollar," Carlo Alberto De Casa, market analyst at Kinesis Money, wrote in a note.

The dollar forfeited gains on Friday, but was still bound for a second straight weekly rise. 

Focus was now on the June personal consumption expenditures (PCE) index, the Fed's favoured inflation gauge, due at 12:30 GMT.

"If we see lower-than-expected PCE numbers, that could translate into lower-than-expected interest rates going forward and that could give a bit of a boost to gold," Gardner noted.

Spot silver XAG= gained 0.7% to $24.31, platinum XPT= rose 0.4% to $939.76 and palladium XPD= eased 0.4% to $1,235.22, all set for weekly losses.

Edited by Reuters

Article Enquiry

Email Article

Save Article

Feedback

To advertise email advertising@creamermedia.co.za or click here

Showroom

Multotec
Multotec

Multotec, recognised industry leaders in metallurgy and process engineering help mining houses across the world process minerals more efficiently,...

VISIT SHOWROOM 
Goodwin Submersible Pumps Africa (Pty) Ltd
Goodwin Submersible Pumps Africa (Pty) Ltd

Goodwin Submersible Pumps Africa is sole distributors for Goodwin electrically driven, submersible, abrasion resistance slurry pumps.

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







301

sq:0.049 0.899s - 140pq - 2rq
Subscribe Now