Gold returned to profit after two consecutive sessions with losses, with the precious metal finding support in the climate of concern about rising inflation and closing at the highest level since June.
Strong data on retail sales and industrial production released yesterday in the US helped allay concerns about the impact of the inflation rally on consumer behavior and manufacturing, but data released today by the US Department of Commerce showed 0.7% drop in home openings in October, as shortages of some materials and price jumps continue to limit construction activity.
In particular, housing starts fell 0.7% to the seasonally adjusted size of 1.520 million units last month.
The decline “was partly due to rising inflation for home construction materials,” said Jeff Wright, chief investment officer at Wolfpack Capital. “Inflation is all around us and gold is benefiting,” he said.
“Inflation concerns and the realization that inflation is out of control are” real and not just for the financial markets. When inflation becomes a problem for large retailers, then the market is looking for clearer alternatives, “Wright said. .
“The recent resurgence of rising inflation expectations supports the gold rally,” analysts at Sevens Report Research wrote in Wednesday’s news release.
“However, if inflation rises further in the coming months, as most central bankers predict, then real interest rates are likely to bottom out and the prospects for new gold records will weaken,” they said.
In the meantime, his performance 10-year government bond of the USA falls on Wednesday by 3 basis points to 1.61%, while the US dollar notes a small drop of 0.16%.
In this climate o December delivery gold It added $ 16.10, or 0.9%, to $ 1,870.20 an ounce, the highest level since June 11, according to FactSet.
As for the other metals, the December delivery silver added 22 cents, or 0.9 percent, to $ 25.16 an ounce, offsetting Tuesday’s losses.
THE December delivery copper fell 2% to $ 4,266 per pound and the January delivery contract for platinum lost 0.5% to $ 1,069.10 an ounce.
Finally, the palladium delivery in December closed at $ 2,184.50 an ounce, up 0.8%.