Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Gold Prices Ride Dollar Misery to Nearly 4-Month Highs

Published 01/11/2018, 01:55 PM
Updated 01/11/2018, 01:55 PM

Investing.com – Gold prices rose to nearly four-month highs as the dollar came under pressure after the euro surged on hawkish European Central Bank meeting minutes suggesting monetary policy tightening may soon follow.

Gold futures for February delivery on the Comex division of the New York Mercantile Exchange rose by $3.80, or 0.29%, to $1,323.10 a troy ounce.

The European Central Bank could consider a gradual shift in guidance from early 2018, the minutes of the ECB December meeting showed, as policymakers saw "some comfort" in wage dynamics despite ongoing concerns over subdued inflation.

The hawkish tone of the minutes fuelled a surge in the euro, pressuring the dollar toward four-month lows, while weaker-than-forecast wholesale inflation for December deepened the dollar’s retreat supporting an uptick in gold prices.

Dollar-denominated assets such as gold are sensitive to moves in the dollar – A dip in the dollar makes gold cheaper for holders of foreign currency and thus, raises demand.

The Labor Department said Thursday its producer price index for final demand fell 0.1% last month after rising 0.2% in November. In the 12 months through December, the PPI rose 2.6, missing expectation for a 3% rise.

The softer wholesale inflation data renewed inflation jitters, easing investor optimism for a more aggressive Federal Reserve stance on monetary policy as investors awaited a consumer inflation report due Friday.

RBC said the softer PPI data signalled “downside risk” to the consumer prices index (CPI) data slated for Friday, noting that the finished consumer goods component fell 0.4% after an impressive 1.7% gain in November.

In other precious metal trade, silver futures fell 0.35% to $16.98 a troy ounce, while platinum futures rose 1.07% to $989.30.

Copper fell 0.14% to $3.23, while natural gas 5.51% to $3.06 following storage data showing natural gas stockpiles fell more than expected.

Latest comments

Silver rose.... to last weeks high.
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.