Gold Hits Six Weeks Lows On Upbeat US Macro Data

Gold prices inched up on Friday but held near six-week lows hit in the previous session, as the dollar firmed after upbeat U.S. economic data supported the Federal Reserve’s resolve for steady interest rate hikes over the next year. The dollar stood tall against its peers on Friday after data showed U.S. economic growth accelerated in the second quarter at its fastest pace in nearly four years. Another report showed durable goods rose 4.5 percent in August, rebounding from a revised 1.2 percent drop the month before. The short-term outlook is bearish for gold as the dollar may see some upside due to an ongoing trade war between China and the U.S. and the Federal Reserve interest rate hike outlook. Spot Gold XAUUSD is currently trading at $1182.2 an ounce down by 0.09% on the day after falling about 1% yesterday touching its lowest since august 17 at $1,181.61 an ounce.

Crude Oil Price Supported By Supply Concerns

Meanwhile US Gold Futures GCcv1 is trading at $1185.30 an ounce down by 0.17% on the day. The U.S. Federal Reserve raised interest rates on Wednesday and said it planned four more increases by the end of 2019 and another in 2020. This is bearish news for Gold as higher value for USD makes non-interest yielding precious metals a less attractive asset. However as gold price went down there has been some activity in physical market mainly from the businesses which are making best use of opportunity to stock up on Gold while its cheap which has offered Gold price action some support in immediate market. Spot Silver XAGUSD is currently trading at $14.29 up 0.27% on the day with relatively less impact on price action when compared to gold albeit facing decline over strong US greenback in broad market.

Oil climbed on Thursday, with the global benchmark’s price notching another four-year high at the settlement, as U.S. officials said the sale of domestic reserves wouldn’t be used to undercut a rally in crude. Anticipation of supply disruptions caused by the renewal of sanctions on Iran also continued to underpin prices. Meanwhile, natural-gas futures rallied after U.S. data revealed a smaller-than-expected weekly rise in domestic supplies of the fuel. While OPEC members in past agreed to boost production to meet supply demands but they failed to deliver a formal plan in their latest meeting to boost output to offset an estimated 2 million barrels a day of oil that estimated to likely be lost due to the Iranian sanctions. Spot crude oil WITUSD is currently trading at $72.55/b up 0.10% on the day.