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Diptendu Lahiri

PRECIOUS-Gold hovers near 7-week peak as U.S. bond yields slip

Apr 16 2021

* Gold up more than 1% this week * Dollar set for back-to-back weekly losses * World stocks near record highs on recovery hopes (Updates prices) By Diptendu Lahiri April 16 Gold prices held steady near their highest since late-February on Friday, en route to their second straight weekly gain, boosted by a drop in U.S. Treasury yields and a weaker dollar. Spot gold was flat at $1,762.70 per ounce by 0740 GMT, after hitting its highest since Feb. 26 at $1,769.37 on Thursday. Bullion is up more than 1% so far this week. U.S. gold futures eased 0.1% to $1,763.80. "We've seen that the 10-year yield has pulled back and has broken through that very important 1.6% level... that probably means there is more weakness in yields, at least near term, which is very supportive for gold," said DailyFX currency strategist Ilya Spivak. Benchmark U.S. Treasury yields slipped to a one-month low, reducing the opportunity cost of holding non-interest bearing gold. The dollar headed for its worst back-to-back weekly drop this year. Meanwhile, data showed China's economy grew at a record pace in the first quarter, expanding 18.3% from a year earlier. Recent economic readings from the United States and China lifted hopes around a swift economic recovery and prompted investors to seek riskier assets. Earlier this week, Federal Reserve Chair Jerome Powell and other Fed officials, said the brighter economic forecasts and a brief period of higher inflation will not affect monetary policy and the central bank will keep its support in place until the crisis is over. "In the long run, some amount of inflation, due to the massive influx stimulus money, will keep gold supported," said Stephen Innes, chief global market strategist at financial services firm Axi. Gold tends to benefit from widespread stimulus measures from central banks because it is widely viewed as a hedge against inflation. Silver slipped 0.1% to $25.84 per ounce. Palladium was up 0.2% at $2,744.91, and gained about 4% for the week. Platinum climbed 0.4% to $1,198.04. (Reporting by Diptendu Lahiri and Brijesh Patel in Bengaluru; Editing by Shailesh Kuber)

PRECIOUS-Gold rises as dollar, yields slip; U.S. economic data in focus

Apr 15 2021

* Dollar falls to four-week low * Gold still trapped in a range trade - analyst * Palladium, platinum up more than 1% (Recasts, adds comment, updates prices) By Diptendu Lahiri April 15 Gold prices rose on Thursday boosted by a weaker dollar and a pullback in U.S. bond yields, while investors awaited U.S. weekly jobless claims and March retail sales data for further clarity on recovery in the world's largest economy. Spot gold was up 0.5% at $1,744.60 per ounce by 0807 GMT. U.S. gold futures rose 0.6% to $1,745.80 per ounce. "A weaker dollar after the Fed speech and the central bank's willingness to tolerate more inflation is keeping gold supported," said Yingtao Jin, an analyst at StoneX Group. The dollar slipped to a four-week low against its rivals, making gold less expensive for other currency holders. Meanwhile, benchmark 10-year U.S. Treasury yields held near a three-week low. Lower bond yields reduce the opportunity cost of holding non-interest bearing gold. U.S. Federal Reserve Chair Jerome Powell said on Wednesday the central bank would cut its monthly bond purchases before committing to an interest rate hike, clarifying the sequence of monetary policy adjustments are still months if not years in the future. "Gold is still trapped in a range trade, until we get above $1,765 per ounce the range trade holds," said Stephen Innes, chief global market strategist at financial services firm Axi. Investors now await the release of U.S. weekly jobless claims and March retail sales data due later in the day for further clues on the recovery in the world's largest economy. "Although gold has lost much of its appeal for investors in 2021 compared to 2020 and the technical picture has deteriorated in favour of bears rather than gold bulls, deep corrections of prices are still viewed as buying opportunities," Avtar Sandu, senior commodities manager at Phillip Futures, said in a note. Among other precious metals, silver gained 0.2% to $25.47 and palladium was up 1.7% at $2,721.96. Platinum rose 1.1% to $1,182.97. (Reporting by Diptendu Lahiri and Brijesh Patel in Bengaluru; Editing by Rashmi Aich and Shailesh Kuber)

PRECIOUS-Gold gives up early gains as firm bond yields offset weak dollar

Apr 14 2021

* U.S. dollar at 3-week low * U.S. CPI gains by the most in more than 8-1/2 years in March * Investors eye U.S. retail sales on Thursday (Updates prices) By Diptendu Lahiri April 14 Gold prices gave up early gains and were flat on Wednesday, as weakness in the U.S. dollar due to higher inflation was countered by some firming in Treasury yields. Spot gold was flat $1,743.01 per ounce by 0549 GMT, after rising as much as 0.3%. U.S. gold futures fell 0.4% to $1,741.30 per ounce. "Though the dollar is weaker this morning, but a slight uptick in U.S. Treasury yields is keeping gold's upside movement muted," said Margaret Yang, a strategist at DailyFX. "The next big thing that investors are looking for is the retail sales data on Thursday and if it beats forecasts, which it is expected to... (It) will put some pressure on gold," she said adding that the fall could be limited since gold has double-bottomed at $1,680. Consumer prices in the United States soared the most in more than 8-1/2 years in March, setting off what most economists expect to be a fleeting spell of higher inflation, supporting bullion — a traditional inflation hedge. The U.S. dollar fell to three-week lows, making gold cheaper for holders of other currencies, while a slight rise in Treasury yields increased the opportunity cost of holding the metal that pays no return. Bullion was also supported by comments from Philadelphia Federal Reserve President Patrick Harker who said the Fed will not withdraw its funding just yet even as the U.S. economy could expand by 5% to 6% this year. Gold must test the $1,760-mark, a former support turned resistance, in order to attract new bullish-pattern traders and push prices higher, Avtar Sandu, a senior commodities manager at Phillip Futures, said in a note. Silver rose 0.1% to $25.35 and palladium was down 0.1% to $2,687.63 per ounce. Platinum gained 0.7% to $1,163.73. (Reporting by Diptendu Lahiri in Bengaluru; Editing by Uttaresh.V and Rashmi Aich)

PRECIOUS-Gold retreats on firm dollar, yields; U.S. inflation data eyed

Apr 13 2021

* U.S. inflation data for March due later in day * U.S. consumers raise inflation outlook - NY Fed survey (Recasts, adds comments; updates prices) By Diptendu Lahiri April 13 Gold prices fell on Tuesday as a stronger dollar and rising Treasury yields dented demand for the safe-haven metal ahead U.S. inflation data later in the day. Spot gold fell 0.4% to $1,725.15 per ounce by 0633 GMT. U.S. gold futures were also down 0.4% at $1,726.20 per ounce. "At the moment, a stronger dollar and higher yields on Treasuries are exerting pressure on gold," said Amit Sajeja, a vice president at Motilal Oswal. A stronger dollar pressures gold as the metal becomes expensive for buyers outside the United States, while higher returns on bonds increases the opportunity cost for holding non-yielding bullion. A survey released on Monday by the Federal Reserve Bank of New York showed U.S. consumers raised their inflation expectations again in March after gradual increases in recent months, and became more positive about the job market, boosting the yields and the dollar. "It's hard to imagine that gold will not gain today if the data shows higher inflation, but there is a big chance of it pulling back later this week if retail sales data comes positive on Thursday," said Stephen Innes, chief global market strategist at financial services firm Axi. Meanwhile, Boston Fed President Eric Rosengren said the U.S. economy may see a substantial turnaround this year as a result of accommodative monetary and fiscal policy, but the job market still has a lot of space for growth. However, there is a "disagreement between the market and the Fed", IG Market analyst Kyle Rodda said. "Even though several strong voices from the Fed have vowed to tolerate inflation and keep rates down till the economy rebounds to satisfactory levels, the market thinks the central bank will have to taper as early as the beginning of 2022," Rodda said. Silver fell 0.1% to $24.81 per ounce, while palladium was flat at $2,676.70 per ounce. Platinum slipped 0.2% to $1,166.82. (Reporting by Diptendu Lahiri in Bengaluru; editing by Uttaresh.V and Subhranshu Sahu)

PRECIOUS-Gold slips as Treasury yields, dollar firm on higher inflation prospects

Apr 12 2021

* U.S. producer prices rise more than expected in March * U.S. economy at an "inflection point", says Powell (Updates prices) By Diptendu Lahiri April 12 Gold prices fell on Monday, weighed down by firmer U.S. Treasury yields and dollar after better-than-expected U.S. economic data lifted prospects for higher inflation. Spot gold fell 0.2% to $1,739.20 per ounce by 0735 GMT. U.S. gold futures were down 0.2% to $1,740.50 per ounce. "Stronger-than-expected data suggests that inflation (will be) picking up faster than expected in months to come, which is leading to a rise in real yields, exerting pressure on gold," said Margaret Yang, a strategist at DailyFX. "Asia Pacific markets were expected to open higher but they are trading lower this morning, raising demand for safe assets and the dollar is winning that race, putting further pressure on gold." Producer prices in the United States rose more than anticipated in March, resulting in the highest annual rise in 9-1/2 years and signalling the start of higher inflation as the economy reopens amid strengthened public health and substantial government assistance. Some investors view gold as a hedge against higher inflation, but higher Treasury yields dull some of the appeal of the non-yielding metal. The dollar index rose 0.1% against rival currencies, making gold expensive for buyers outside the United States. "For now, gold looks set to trade quietly in a $1,730 to $1,760 range, with Bitcoin seemingly the safe-haven asset of choice at the moment," OANDA senior market analyst Jeffrey Halley said in a note. "In the meantime, gold remains at the mercy of the U.S. 10-year Treasury yield." Federal Reserve Chairman Jerome Powell said the U.S. economy is at an "inflection point," with hopes that inflation and hiring will accelerate in the coming months, but there are dangers if a hasty reopening leads to a continuing uptick in coronavirus cases. Elsewhere, silver fell 0.6% to $25.09 and palladium was down 0.4% to $2,628.40. Platinum slipped 1% to $1,186.06 (Reporting by Diptendu Lahiri in Bengaluru; Editing by Shailesh Kuber and Rashmi Aich)

PRECIOUS-Gold dips after promising China data; set for weekly rise

Apr 09 2021

* Gold hovers below Thursday's 1-month peak * China factory gate prices rise by most in nearly 3 years * Palladium faces biggest weekly decline in six weeks (Adds comments; updates prices) By Diptendu Lahiri April 9 Gold prices fell on Friday as robust economic data from China boosted hopes of a swift recovery, though bullion was set to rise more than 1% on the week as the U.S. dollar and Treasury yields pulled back from recent highs. China's March factory gate prices rose at their fastest annual pace since July 2018, beating estimates. Spot gold fell 0.4% to $1,748.81 per ounce at 0655 GMT, having hit its highest since March 1 at $1,758.45 an ounce on Thursday. U.S. gold futures slipped 0.5% to $1,748.70 per ounce. "Gold is facing some headwinds due to optimism around the recovery story as a result of strong data that has been coming out of the United States and China," said Ravindra Rao, vice president, commodities at Kotak Securities. Still, the metal has gained nearly 1.2% this week, after two weeks of losses. "The (falling) dollar and Treasury yields have helped gold this week along with the Fed's dovish tone, that has been topped with lockdowns in Europe and parts of Asia with some negative vaccine results," said Brian Lan, managing director at dealer GoldSilver Central. Recent robust economic data, driven by massive stimulus measures, has dulled safe-haven demand for bullion. Federal Reserve Chair Jerome Powell on Thursday signalled the central bank is nowhere near to reducing its support for the U.S. economy and cautioned that the anticipated price increase this year is likely to be temporary. "The likely rise in inflation in April could support gold prices in the coming weeks, especially if it rises faster than bond yields. In the more medium term, the rise in bond yields is likely to put renewed pressure on gold," Fitch Solutions said in a note. Silver eased 0.8% to $25.23 and platinum was down 1.2%, at $1,214.67. Palladium rose 0.2% to $2,630.11, but was on track for its biggest weekly fall since week ending Feb. 26. (Reporting by Diptendu Lahiri and Swati Verma in Bengaluru; Editing by Uttaresh.V, Amy Caren Daniel and Shailesh Kuber)

PRECIOUS-Gold gains as dollar, yields fall after U.S. Fed maintains stance

Apr 08 2021

* Fed committed to support economy until recovery is more secure * Dollar trading near more than two-week low * Markets eye Powell's speech at IMF conference (Recasts, adds comments; updates prices) By Diptendu Lahiri April 8 Gold prices rose on Thursday, as yields on longer-term U.S. Treasuries dropped along with the dollar after the Federal Reserve in its latest policy meeting minutes reinforced expectations that interest rates would remain low for some time. Spot gold gained 0.3% at $1,741.85 per ounce by 0927 GMT. U.S. gold futures rose 0.1% to $1,742.90 per ounce. "Gold is gaining at the moment as it is tracing the path of the U.S. Treasuries, which is also putting some pressure on the dollar," said Yingtao Jin, an analyst at StoneX Group. "As the Fed mentioned, they see the economy strong at the beginning of 2022, but that is at a cost of rising inflation rate, which can go out of hand and that is the time when we will see some solid gains in gold." Non-yielding gold is widely considered as a hedge against increasing inflation. Fed officials are committed to supporting the economy until its recovery is more secure, minutes of the U.S. central bank's most recent policy meeting released on Wednesday showed. Several policymakers also indicated they thought interest rates might need to increase sooner than anticipated, although there was little sense of urgency around that issue in the minutes. "The Fed was very assuring about its stand on interest rates, although investors are not convinced," said Michael McCarthy, chief market strategist at CMC Markets. "Investors are expecting the Fed will have to hike interest rates as early as January 2022 as it becomes a huge task once inflation starts going out of control." Investors now await Fed Chair Jerome Powell's speech at a virtual International Monetary Fund conference later on Thursday. Among other metals, silver rose 0.3% to $25.18 per ounce and palladium was down 0.4% at $2,613.74. Platinum dipped 0.1% to $1,224.03. (Reporting by Diptendu Lahiri in Bengaluru; editing by Uttaresh.V, Subhranshu Sahu and Amy Caren Daniel)

PRECIOUS-Gold slips as strong U.S. data dims safe-haven appeal

Apr 07 2021

* Investors eye U.S. Fed meeting minutes at 1800 GMT * Asian shares hit three-week high * U.S. job openings rise to 2-year high in February (Adds comments, updates prices) By Diptendu Lahiri April 7 Gold prices dropped on Wednesday as expanded coronavirus vaccinations and a slew of upbeat data from the United States sparked hopes about a faster economic rebound, weighing on the metal's safe-haven appeal. Spot gold was down 0.2% to $1,740.37 per ounce by 0634 GMT. U.S. gold futures slipped 0.2% to $1,739.40 per ounce. "The better-than-expected economic data from the United States is not allowing gold prices to go above a certain level," said Sunilkumar Katke, head of currencies and commodities at Axis Securities. In the latest round of robust economic data, work opportunities in the United States reached a two-year peak in February, as hiring grew in response to rising domestic demand, increased COVID-19 vaccinations, and additional government pandemic assistance. The International Monetary Fund also raised its outlook for global economic growth, forecasting worldwide output would rise 6% this year. Gold was also pressured as Asian shares climbed to three-week highs, reducing investors' appetite for bullion. "Once gold touches the $1,750 resistance level, technical longs will be initiated and that might push prices up to $1,780," Katke added. Bullion prices rose to their highest level since March 25 at $1,745.15 on Tuesday, as U.S. Treasury yields eased and the dollar fell to a two-week low against a basket of currencies. "Softening of the yields points towards a situation where central banks around the globe will remain dovish and that will support gold at least in the medium term," said Stephen Innes, chief global market strategist at financial services firm Axi. Market participants now await the release of minutes from the U.S. Federal Reserve's March 16-17 policy meeting at 1800 GMT. Among other metals, silver fell 0.4% to $25.06 per ounce and palladium was down 0.3% to $2,677.16, while Platinum rose 0.5% to $1,238.72. (Reporting by Diptendu Lahiri in Bengaluru; Editing by Subhranshu Sahu and Shailesh Kuber)

PRECIOUS-Gold hits more than one-week peak as dollar and yields slip

Apr 06 2021

* Dollar at an almost two-week low * Strong U.S. data lifts stocks to record highs (Adds comments; updates prices) By Diptendu Lahiri April 6 Gold prices climbed to their highest in more than a week on Tuesday as a weaker dollar and a drop in U.S. bond yields boosted demand for the metal. Spot gold was up 0.1% at $1,730.46 an ounce by 0703 GMT after touching its highest since March 25 at $1,737.35. U.S. gold futures rose 0.1% to $1,731.10. "The strong U.S. economic data have eased concerns and have softened the dollar as a safe-haven asset, and gold is being supported because of that," said Michael McCarthy, chief market strategist at CMC Markets. The dollar slumped to an almost two-week low against a basket of rival currencies, making gold cheaper for buyers outside the United States. Benchmark U.S. Treasury yields slipped, moving further away from a 14-month peak hit last week, reducing the opportunity cost of holding non-yielding gold. Better than expected recent economic readings out of the United States, meanwhile, have lifted hopes of swift recovery and drove investors towards riskier assets. "Gold has formed a short-term double bottom but needs to break above $1,750 before it can head higher," Stephen Innes, chief global market strategist at financial services firm Axi, said in a note. "The metal could struggle to extend last week's recovery with the positive U.S. non-farm payroll data underpinning risk-on sentiment." The U.S. economic outlook is brightening, Cleveland Federal Reserve Bank President Loretta Mester said on Monday, adding that the Federal Reserve should stick to its easy monetary policy to help to support growth further. "The coordinated approach of central banks has kept gold supported for quite some time and that's what we are also seeing today," CMC's McCarthy said. Elsewhere, silver fell 0.1% to $24.88 an ounce while palladium rose 0.3% to $2,671.97 and platinum edged 0.1% down to $1,207.43. (Reporting by Diptendu Lahiri in Bengaluru Editing by Shailesh Kuber and David Goodman )

CORRECTED-PRECIOUS-Gold prices slip as strong U.S. jobs data boosts dollar, yields

Apr 05 2021

(Corrects U.S. gold futures price to $1,726.40 per ounce from $11,762.40 in second paragraph) * U.S. non-farm payrolls surge more than 900,000 in March * Global stocks hit their highest in a month and half * Platinum scales more than 2-week high before declining By Diptendu Lahiri April 5 Gold prices eased on Monday as U.S. Treasury yields rose and the dollar strengthened after better-than-expected jobs data from the world's top economy fuelled optimism over a swift recovery. Spot gold was down 0.1% to $1,726.36 per ounce by 0733 GMT. U.S. gold futures were little changed at $1,726.40 per ounce. "Strong payroll data has boosted the dollar and yields and is weighing on gold prices. I think gold's primary trend is bearish," said DailyFX strategist Margaret Yang. "Global economic growth is definitely taking a positive turn, however, it is uneven. Growth in the U.S. is particularly strong, but parts of the EU are having a challenging time with the third wave of virus." The U.S. economy created the most jobs in seven months in March as more Americans got vaccinated and the government doled out additional pandemic relief money. That lifted global stock prices to a more than one-month high on Monday, while benchmark U.S. Treasury yields held near a 14-month peak. The dollar rose 0.1% against its rivals ahead of U.S. services sector data, making gold more expensive for holders of other currencies. U.S. President Joe Biden's announcement of a long-awaited $2 trillion-plus job plan last week has raised some concerns over inflation. Some investors view gold as a hedge against inflation, but higher Treasury yields, which translate into a higher opportunity cost for holding bullion, have challenged that status. "It is becoming clear to me that gold's sensitivity is not to future inflation expectations, but rather, to moves in U.S. bond yields, notably the 10-year tenor," OANDA senior market analyst Jeffrey Halley said in a note. Elsewhere, silver fell 0.8% to $24.77 per ounce and palladium was down 1.1% at $2,637.64. Platinum dipped 0.5% to $1,203.49 per ounce after hitting its highest since March 18 earlier in the session at $1,218. (Reporting by Diptendu Lahiri and Brijesh Patel in Bengaluru, Editing by Sherry Jacob-Phillips, Amy Caren Daniel and Subhranshu Sahu)

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