Gold prices steady after hitting all-time high
Gold prices remained steady on Thursday after reaching a record high in the previous session. Despite a stronger dollar and an increase in U.S. Treasury yields, which offset the safe-haven demand for gold, the precious metal held its ground.
FUNDAMENTALS
Spot gold was flat at $2,718.32 per ounce, with U.S. gold futures slightly higher at $2,732.10. Prices surged to a new peak of $2,758.37 on Wednesday due to uncertainties surrounding the U.S. election and escalating tensions in the Middle East.
Geopolitical tensions and economic indicators
Geopolitical tensions in the Middle East, including Israeli strikes in Beirut and Hezbollah’s missile attacks on Israeli targets, have contributed to the safe-haven appeal of gold. Additionally, uncertainties surrounding the upcoming U.S. election, with Vice President Harris and former President Trump in a close race, have also driven investors towards gold.
However, the strength of the U.S. dollar and the rise in benchmark 10-year Treasury yields have limited gold’s gains. A stronger dollar makes gold more expensive for buyers using other currencies, dampening demand for the precious metal.
Market expectations
Market analysts are anticipating a 25-basis-point cut in the Federal Reserve rate soon, with an 90.4% chance of this occurring at the November meeting. Lower interest rates make non-yielding assets like gold more attractive to investors.
In other news, China’s imports of gold ore and concentrate dropped significantly in September due to proposed tax changes that could increase buyers’ tax liabilities.
Silver, platinum, and palladium
Spot silver rose by 0.2% to $33.80 per ounce, hitting its highest level since late 2012. Platinum also saw a gain of 0.6% at $1,022.25, while palladium surged by 2.9% to $1,090.50.
Upcoming data/events
The economic calendar for the day includes key data such as France’s HCOB Mfg, Svcs, and Comp Flash PMIs for October, Germany’s HCOB Mfg, Svcs, and Comp Flash PMIs, and the UK’s CBI Business Optimism for Q4. In the U.S., the initial jobless claims and S&P Global Mfg, Svcs, and Comp Flash PMIs for October are also scheduled to be released.
