Slight recovery for gold after three months low

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With modest gains that took it somewhat away from the three-month low of yesterday’s close, gold moved today, taking advantage of the weakening dollar.

In particular, the June contract for gold completed the trades with an increase of 0.7% or $ 12.7 to $ 1,853.7 an ounce.

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The session was marked by a sharp jump after the announcement of inflation data, however, the precious metal recovered relatively quickly with the help of the dollar and bonds.

Following a reversal, the dollar index initially rose sharply after the data but eventually fell from the recent 20-year high, while the 10-year US after a momentary rise above 3% then saw the performance stabilize in the region of 2 , 9%.

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It is noted that both assets operate competitively in terms of the price of gold. The dollar because it makes the metal more expensive for holders of other exchange rates, while bond yields lure investors as gold does not offer a fixed interest rate.

On the inflation front, data released today in the US showed that it moved at a pace that exceeded estimates in April, as the consumer price index rose by 0.3% on a monthly basis and by 8.3% on an annual basis, while the market expect + 0.2% and + 8.1% respectively.

However, for the first time in recent months, it did not reach a new high of 40 years, but moved even slightly downwards.

According to the independent trader in New York Tai Wong, “the market read the data ‘SELL, SELL, SELL’ in the data. and scary. ”

“The Fed will not be more aggressive with this report, but it certainly will not relax. However, the investment mood may have reached its maximum bearish at the moment so we could therefore see a significant recovery,” he added. .

On the other metals, the July contract in silver also rose slightly by 0.7% or 15 cents, closing at $ 21,575 an ounce.

July copper rose 1.3% to close at 4,209 pounds, July platinum jumped 4.5% to $ 989.9 an ounce, while palladium July lost 1.8% to $ 2,007.9 an ounce. ounce.

Source: Capital

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