Inflation concerns pushed gold and silver to a two-month high

Gold climbed to a two-month high on Wednesday, ending in positive territory for the first time after three downtrends, as the weakening dollar and the slight decline in US government bond yields, after their sudden rally, returned investment interest in precious metal.

The recent rise in US bond yields, with the 10-year yield approaching almost 1.90%, has cut off the investment “appetite” for precious metals, which compete with bonds as a “safe haven” but lag behind as they offer no yield. . Today’s decline in yields, however, to 1.829%, worked positively for gold.

An additional boost to the precious metal was provided today by the weakening of the dollar, with the ICE US Dollar index, which tracks the US currency against half a dozen major currencies, fell by 0.2%, after its recent rise.

“We could not be more optimistic [για τον χρυσό] “For the next six months or so, the US economy is starting to slow down,” Michael Armbruster, Altavest’s managing partner, told MarketWatch.

“The movement of the gold price is very upward as bond yields are already on an upward trajectory. We believe that bond yields are likely to peak soon and, if we are right, this could push gold prices to 2,000. dollars or even higher, “he added.

In this context, on Wednesday, the February contract for gold added $ 30.80 or 1.7% and climbed to $ 1,843.20 an ounce, after the loss sessions, recording the largest daily increase since December. Today’s close is the highest for gold since November 19, according to FactSet.

Meanwhile, silver continued its upward trend today, with the March delivery contract strengthening by 74 cents or almost 3.2% and closing at $ 24,231 an ounce, after rising by 2.5% on Tuesday. This is also the highest closing of the metal since November 22, according to FactSet.

It is noted that silver, which attracts buying interest as it is treated as an industrial asset, so far records profits of more than 5% per week. Respectively, gold has strengthened so far in the five days by about 1.4%.

“Higher volatility and the downturn in the stock markets have helped the precious metal to some extent reduce its losses,” Naeem Aslam, chief market analyst at AvaTrade, wrote in a daily note. The Dow Jones Industrial Average DJIA, -0.15%, the S&P 500 SPX, 0.05% and the Nasdaq Composite Index COMP, 0.24% are falling sharply for the week and month, so far.

The other metals recorded gains on Wednesday. More specifically, the March delivery copper strengthened by 2% and closed at $ 4.47 a pound, the April contract for platinum added 5% and ended at $ 1,028.40 an ounce, while the March delivery pald closed at 2,008.40 dollars per ounce, with gains of almost 5.5%.