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Tuesday, May 24, 2022

Gold Prices Recover From 6-Month Low As Dollar Retreats

Gold Prices Recover From 6-Month Low As Dollar RetreatsGold prices recovered from a 6-month low on Friday

Investing.com – Gold prices recovered from a 6-month low on Friday as the dollar slipped after hitting a 11-month peak earlier in the day.

for August delivery on the Comex division of the New York Mercantile Exchange gained 0.1%, to $1,269.30 a troy ounce by 1:13AM ET (05:13 GMT).

The dollar fell off a 11-month high in morning Asian trade on Friday, as analysts say the plunge of Philadelphia Federal Reserve’s manufacturing index prompted some traders to book profits on bullish dollar bets.

The Philadelphia Fed index on U.S. Mid-Atlantic business activity fell to 19.9 in June from 34.4 in May. The Philly Fed weaker data dragged down U.S. Treasury yields, which also affected the dollar.

The that tracks the greenback against six other currencies was down by 0.06% to 94.48 after touching 95.533, its highest level since last July.

Dollar-denominated assets such as gold are sensitive to moves in the dollar – A fall in the dollar makes gold less expensive for holders of foreign currency and thus, increases demand for the precious metal.

Meanwhile, the European slapped penalties on multiple American products that worth around $3.2 billion on Friday, including bourbon, motorcycles and orange juice as retaliatory measures against Trump administration’s tariffs.  

The news were cited as supportive for the safe-haven gold, as it added another front to a trade war that triggered a sell-off in global equities since the beginning of the week.  

“We did everything we could to avoid this situation, but now we have no choice but to respond,” Cecilia Malmstrom, the European commissioner for trade, said in a speech in Wellington, New Zealand. “The E.U. has a responsibility to stand up for open global trade.” 

In other precious metal trade, edged up 0.02% to $16.330 a troy ounce, while fell 0.53% at $859.1 an ounce.  

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Source: Investing.com

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