1% rise for gold – At the highest level since June

The price of gold closed higher on Wednesday, with the precious metal closing at the highest level since June, as data released today showed that annual inflation in the US jumped to a high of 31 years.

Particularly, the consumer price index increased by 6.2% from October 2020, according to data released today by the US Department of Commerce. Since September, the consumer price index has risen by 0.9%, showing the largest monthly increase in the last four months. The structural index, which does not include food and energy, increased by 0.6%. Analysts’ average estimates in a Bloomberg poll put the annual increase at 5.9%, up 0.6% from the previous month.

Gold is a “perfect hedge against inflation” and the price of gold has made “huge uptrends” in the wake of the announcement of the data, said Naeem Aslam, chief market analyst at AvaTrade. “This is despite the fact that the dollar has moved higher, as traders believe the Fed is lagging behind in its policy and needs to do something to control inflation,” he added.

The ICE US Dollar Index, a measure against the dollar against six major currencies, rose 0.9 percent.

In this climate, the gold delivery in December gained $ 17.50, or 1%, to close at $ 1,848.30 an ounce, the fifth consecutive uptrend in the highest-grossing series since July 7, according to Dow Jones Market Data. At the same time, this is the highest closing since June 16.

Meanwhile, the December delivery silver added 45 cents, or 1.9 percent, to $ 24,772 an ounce, the highest closing since early September.

The rise in inflation was supported by “significant wage increases and supply chain disruptions,” said Juan Carlos Artigas, a senior executive at the World Gold Council.

In other metals, the December delivery copper fell 1.1% to $ 4,323 a pound. Alongside, the platinum delivery in January rose 1.5% to $ 1,077 an ounce and the palladium of December delivery added 0.8% to $ 2,038.90 an ounce.