Gold Holds Steady As USD Weakens on Retreating US Bond YieldsPrecious metals move down despite weaker USD in broad market owing to positive outlook for USD in near future market sessions.
Gold held steady in a narrow price range on Wednesday as the dollar pulled back from a seven-week peak although support remained strong for the U.S. currency on the back of a strong U.S. economy and expectations of steady interest rate hikes by the Federal Reserve. Spot Gold XAUUSD held steady within yesterday’s high and lows for majority of Asian market hours but as of writing this article, the pair is trading slightly downtrend at $186.63 an ounce down by 0.26% on the day, while US Gold Futures GCcv1 is currently trading at $1190 an ounce down 0.12% on the day.
While analysts and investors expected gold prices to edge up on a weak dollar in the broad market, the pair has maintained a dovish price action so far in today’s market hours.
Oil Price Supported By Production Cut In Mexican Gulf Coast Owing to Hurricane
The recent revisions to jobs data have underscored the upward pressure on U.S. rates and FOMC policy choices. Meanwhile, U.S. President Donald Trump on Tuesday again criticized the Fed, telling reporters the central bank is going too fast in raising rates when inflation is minimal and government data points to a strong economy and this resulted in US dollar index which measures the greenback against six major currencies to take a muted stance. Spot silver XAGUSD is currently trading at $14.345 an ounce down by 0.28% on the day. Oil prices edged lower on Wednesday after the IMF lowered its global growth forecasts but prices were supported as Hurricane Michael churned towards Florida, causing the shutdown of nearly 40 percent of U.S. Gulf of Mexico crude output.
The International Monetary Fund downgraded its global economic growth forecasts for 2018 and 2019 on Tuesday, raising concerns that demand for oil products may slump as well. Trade tensions and rising import tariffs were taking a toll on commerce while emerging markets struggle with tighter financial conditions and capital outflows, the IMF said. Iran’s crude exports fell further in the first week of October, according to tanker data and an industry source, as buyers sought alternatives ahead of U.S. sanctions that take effect on Nov. 4. Crude oil futures were lower during mid-morning trade in Asia Wednesday ahead of the release of US crude inventory data that is expected to show a build.
Meanwhile, news hit the market that Saudi Arabia is to supply India with an extra 4 million barrels of Oil in December as India attempts to compensate for a reduction of Iranian Crude Oil. Spot US Crude WTIUSD is currently trading at $75.09 up 0.35% on the day.