Gold growth is limited due to higher rates
2022.12.20 03:40
Gold growth is limited due to higher rates
Budrigannews.com – On Tuesday, gold prices moved further away from important levels as investors turned to the dollar and Treasury yields amid worries about rising interest rates and a possible recession in 2023. The overall metal market also came under pressure.
After recovering strongly from a five-month low earlier, the held steady against a basket of currencies this week and firmed for a third session in a row.
As gold largely ceded its safe haven status to the dollar this year, this put pressure on bullion prices with a clear lack of bids. The yellow metal is down significantly from its peak during the early days of the Russia-Ukraine conflict, and its price is slightly lower for 2022.
By 19:25 ET (00:25 GMT), it had fallen 0.1% to $1,785.46 an ounce and 0.2% to $1,794.60 an ounce.
The most recent selling tension on gold comes from a progression of hawkish national bank remarks last week, which proclaimed a proceeded with ascend in loan fees in the approaching year. As rising rates raised the opportunity cost of holding non-yielding assets, the trend puts even more pressure on gold and other metals.
In addition, investors are now concerned about the possibility of a recession in 2023, primarily due to high inflation and rising interest rates.
Since there aren’t any other clues, the last two trading weeks of 2022 are expected to be dominated by concerns about economic slowdown. A number of market holidays are also expected to reduce trading volumes.
On Tuesday, other precious metals also fell.
Due to persistent bets that a Chinese economic recovery will fuel copper demand, copper prices were steady compared to their peers in the industrial metals market.
to $3.7637 a pound, up 1%.
Be that as it may, the red metal’s standpoint stays obfuscated by vulnerability over a worldwide downturn, with debilitating financial movement across the globe prone to counterbalance an interest recuperation in significant merchant China.
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However, political unrest in Chile and Peru, two of the world’s largest copper producers, is likely to tighten supply, which will help support prices in the coming months.
