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Gold Hits 5-Month Low
Gold Hits 5-Month Low

Gold Hits 5-Month Low

Gold Hits 5-Month Low

Gold prices fell to their lowest in over five months on Friday, hit by a broad sell-off in commodities as well as surging bond yields on speculation a splurge of US infrastructure spending could stoke inflation.
Spot gold fell 2.2% to $1,231.79 an ounce after touching a session low of $1,229.04, the weakest since June 3. It has shed over 5% so far this week, AFP reported.
US gold futures fell 2.6% to $1,234.50 per ounce after falling to $1,228.50, the weakest since June 3.
Gold was already slightly weaker before base metals reversed and went into negative territory after a sizzling rally, while oil extended losses.
Gold is highly sensitive to rising rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
But the weakness in gold may be short-lived, Commodities Economist Simona Gambarini at Capital Economics said in a note.
“The euphoria about infrastructure spending could soon be replaced by concerns about a trade war and geopolitical risks, restoring the safe-haven bid for gold.”
In Asian trading, gold had been supported on the downside by physical buying. Gold premiums in India jumped to their highest in 21 months, as demand surged after the government abolished two high-value currency notes, while bargain hunting propped up demand and premiums in leading consumer China.
Silver and platinum group metals were also swept lower along with gold. Silver slid 3.8% to $18.84 an ounce, the weakest since Nov. 1.
Platinum dropped 2.3% to $949.50 an ounce, the lowest since Oct. 25. Palladium shed 1.9% to $675.70 an ounce, after rising to its highest since Oct. 5 at $697.90 earlier.

 

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