Gold Consolidates After a Strong Fall…and the Dollar Off a 6-Week High By Investing.com

Investing.com – Gold prices witnessed some improvement in early trading today, Thursday, after the strong declines they witnessed during the past few hours, as concerns about the…

Yesterday’s declines came in conjunction with a strong rise in the US currency to its highest level in about 6 weeks, with levels exceeding 104 points, which came after strong US data.

“The US economy continues to do very well, there is very strong data coming out on the labor market, we think the Federal Reserve has more work to do,” said Jarrod Kerr, chief economist at Kiwi Bank.

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gold today

Prices of the yellow metal rose in early trading today by more than $4, or the equivalent of 0.25%, to levels near $1,850 an ounce.

Spot gold prices increased at a greater pace, to rise within $6 to higher levels of $1841 an ounce, up by 0.35% during Thursday’s trading.

dollar today

The main decline against a basket of currencies increased by 0.3% to 103.65 levels, after hitting a six-week high at 104.11 in yesterday’s Wednesday session.

The yield on the US for 10 years decreased after the strong rise during yesterday’s trading, to decline by 0.022 points to 3.785%.

What happened?

It fell by more than 1% at the end of trading on Wednesday, with rising expectations regarding the continuation of raising US interest rates, after the release of retail sales data.

The rise of the US dollar against other major currencies, in addition to the rise in the 10-year Treasury yield at 3.81%, put pressure on gold prices.

Retail sales in the United States rose by 3% in January, exceeding expectations for a 1.9% rise.

This came in conjunction with data showing an increase in US annual inflation by more than estimates during last January, which raised expectations about the continued tightening of monetary policy by the Federal Reserve.

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strong pressure

Harish said. Head of Commodities Research at Geojit Financial Services: “Despite the recent positive economic data from the US and the continued strength of the US dollar on gold’s safe-haven status, there are opportunities for a soft new technical recovery.”

He added, “The data may give the US Central Bank confidence to raise interest rates more, which puts pressure on gold in the short term.”

Retail sales rose in the United States by more than expectations during the past month, with continued labor market strength and slowing inflation, and US Census Bureau data revealed that seasonally adjusted retail sales rose by 3% last January on a monthly basis, outperforming expectations that were indicating an increase. 1.9%.

According to the data, sales of food and beverage services increased by 7.2%, sales of automobiles and spare parts increased by 5.9%, and sales of furniture increased by 4.4%. On an annual basis, US retail sales increased by 6.4% in January compared to the same period one year earlier.

Interest pricing

Financial market expectations indicate that the interest range will reach 5% and 5.25%, compared to the current level between 4.5% and 4.75%. Zero last March.

The markets are currently pricing in interest rates rising to a range of 5% and 5.25%, compared to the current level between 4.5% and 4.75%. Near zero last March.

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