The price of gold decreased by 20 US dollars . Gold fell at the end of trading Monday March 29, 2022 time in place Tuesday morning WIB. More than one percent to its lowest level in more than two weeks.
The weakening of the precious metal was driven by the strengthening of the US dollar, and the increase in yields of US treasury bonds eroded the magnetism of the yellow metal’s safe-haven assets, prompting bets on a rapid economic recovery in the US.
The very active gold contract for April haul on the COMEX section of the New York Stock Exchange fell $20.10, or 1.16%, to close at $1,712.20 an ounce after hitting 1,705 levels, down $75, a reduction in COMEX Gold. Biggest day since March 18th.
The price of gold decreased by 20 US dollars. “A bull market in gold needs essential support,” said Jim Wyckoff, senior research fellow at Kitco Metals. He explained that the strengthening of the US dollar and increasing yields were limiting interest in buying gold.
The US dollar index is near the key level of 93 adding new emphasis to gold. The stronger dollar index version of its core competitors, makes gold less attractive to investors holding other currencies.
“The rapid reconditioning of the US economy with increased vaccine volumes and information from US President Joe Biden this week had a negative effect on gold prices in the short term,” said Wyckoff. Biden will roll out the details of his infrastructure spending package on Wednesday (31/3/2022), which could cost between $3 and 4 trillion.
Higher returns counter gold’s status as an inflation hedge, as it creates a greater loss opportunity for holding non-profitable gold. US 10-year debt returns are near 1.7%.
“Neither the US 10-year bond yields nor the dollar can say very high for today, but gold has not witnessed any significant movement in either direction over the past week so the current downward slope may be overblown,” said expert Philip constant precious metal tactics at Blueline Futures in Chicago.
“Gold may fall below $1,700, but it should recover,” he continued. “We see almost no room for significantly higher gold prices through the middle of the year, although gold will make significant gains in the second half of the year,” noted some research at Commerzbank in a US dollar note.
Another precious metal, silver for May delivery, fell 34.3 cents, or 1.37%, to $24.771 an ounce. Platinum for July haul was up $2.40, or 0.2%, to close at $1,184.10 an ounce.
