Gold prices rise with continued weak performance of the US dollar
Last Updated on October 20, 2021
Gold prices rose during the trading session today in the European market, to approach towards recording its first daily gains during the last three sessions. The industrial sector in the United States, and in light of the decline in the yield of long-term US Treasury bonds.
Gold prices retest the resistance level
By 09:50 GMT, the spot price of gold was up by about 0.9%, to trade around the level of 1782.92 US dollars an ounce, from the opening level of today’s session at 1767.74 dollars, and the lowest price was at 1762.85 dollars an ounce.
Gold in US futures also rose 0.2% to $1,783.54 an ounce.
At the conclusion of yesterday’s trading, the precious metal “gold” lost 0.1% in the second consecutive daily loss, with continued selling with the aim of taking profits, after hitting its highest level in four weeks at $1800.50 an ounce.
The USD declines
In terms of the US dollar index trading, the index fell during today’s session by 0.5%, in the fifth daily loss in a row, thus recording its lowest level in three weeks at 93.50 points, reflecting the continued selling of the US currency against most major and minor currencies, which contributes Currently in support of the price movements of gold and other metals priced in dollars according to the inverse relationship between them.
This recent decline in the US currency comes as a result of the slowdown in dollar purchases as the best investment available, especially after the release of weak data on industrial production in the United States, as these data indicated a contraction in industrial production at a rate of 1.3% during the previous month of September, worse than economic expectations that indicated to a growth rate of 0.3%.
Other than that, and what recently negatively affected the dollar’s movement, the US ten-year Treasury bond yield declined, as the yield fell today by about 2.5%, on its way to recording its first daily losses during the last three sessions.
And as we know that the low yield provides more support for gold prices and thus increases the opportunity cost of acquiring the non-returnable metal.
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