Pages

Search This Blog

Translate

Search Tool




Oct 8, 2020

Gold Price Report: Gold steadies as election uncertainty offsets higher dollar, equities

 

2-3 minutes - Source: CNBC


Several gold bars are shown being held in a hand.

Several gold bars are shown being held in a hand.

Akos Stiller | Bloomberg | Getty Images

Gold steadied in choppy trading on Thursday as uncertainty surrounding the U.S. presidential elections and bets that fresh stimulus would drive inflation offset pressure for bullion from a higher dollar and improved appetite for riskier assets.

Spot gold fell 0.01% to $1,887.11 per ounce flipping back and forth between positive and negative territory. U.S. gold futures were up 0.03% to $1,891.40.

While there is a “pretty robust increase in risk appetite,” with a higher dollar also weighing, inflation expectations are keeping gold supported, said Bart Melek, head of commodity strategies at TD Securities.

“We’re not saying that there’s going to be an inflation problem right away, but the concern is that if the policies continue and are repeated post election, then we would likely see both a lower dollar and real rates that will likely move lower.”

Market participants expect U.S. President Donald Trump and House Speaker Nancy Pelosi would agree aid for airlines amid stubbornly high jobless claims. However, world shares headed for a one-month high as hopes for more stimulus offset Europe’s rising numbers of coronavirus cases and lockdowns, in turn capping bullion’s advance.

A higher dollar too kept gold in check. But gold was still up 24% so this year, boosted by unprecedented government and central bank stimulus worldwide to revive economies as it’s viewed as a hedge against inflation and a safe refuge during economic and politic uncertainties.

“It’s (Gold) going to move higher, it’s going to be volatile. That’s going to be true for the next month going into the election, it’s going to be true for the two months after the election,” said Jeffrey Christian, managing partner of CPM Group.

Among other metals, silver gained 0.04% to $23.85 per ounce. Platinum was at $867.89, while palladium fell 0.2% to $2,347.20 per ounce.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.