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Gold Down over Strengthening U.S. Dollar

Commodities Jun 13, 2022 12:36AM ET
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© Reuters.

By Zhang Mengying

Investing.com – Gold was down on Monday morning in Asia over strengthening U.S. dollars as Friday's high U.S. inflation data suggested more aggressive monetary tightening.

Gold futures were down 0.51% to $1,865.95 by 12:25 AM ET (4:25 AM GMT). The dollar, which normally moves inversely to gold, fell on Monday morning.

Benchmark U.S. 10-year Treasury yields also rose to their highest since May 9, denting demand for zero-yield gold.

U.S. inflation data Friday showed that the U.S. consumer price index released Friday rose 8.6% in May year-on-year, a fresh 40-year high, adding to investors’ concerns about a recession caused by tightening monetary policies from the U.S. Federal Reserve.

The Fed’s June meeting will be held on Wednesday, where the central bank is expected to deliver its second straight half-point interest rate hike to cool inflation.

“The fact that gold disconnected itself from moving inversely to the U.S. dollar suggests to me that markets are belatedly moving into a much more vigorous risk aversion mode (due to the inflation data),” OANDA senior analyst Jeffrey Halley said.

“The data delivered an unsympathetic wakeup call to financial markets that inflation remains both entrenched and has real upside risks. Gold is benefiting from a swing to defensive haven positioning as equities and cryptos get hammered,” OANDA senior analyst Jeffrey Halley told Reuters.

Adding to investors' concerns about an economic downturn, Beijing announced on Sunday three rounds of mass testing as it saw new COVID-19 outbreaks.

For moves of other central banks, the Bank of England will hand down its policy decision on Thursday, while the Bank of Japan follows on Friday.

In other precious metals, silver fell 1.35%. Platinum dived 1.42% and palladium fell 1.29%.

Gold Down over Strengthening U.S. Dollar
 

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Shovan Ghosh
Shovan Ghosh Jun 13, 2022 9:26AM ET
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it seems i running the market every time open position market goes other side......what is going on market create drama or manipulation starts..............
The king TD David
the2775kingTD Jun 13, 2022 1:05AM ET
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Possibility that Gold will go to 1880 then 1900" is very high now
 
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