Gold Pulls Back in Asia as Weakness Remains
2022.07.20 05:50
By Doris Yu
Investing.com – Gold was down Wednesday morning in Asia, continuing along a downward trend and moving inversely to rising interest rates.
Gold futures for August delivery were down 0.15% to $1,708.25 by 10:10 PM ET (2:10 AM GMT). The US Dollar Index, which tracks the dollar against a basket of currencies, was little changed, down just 0.04% to 106.64.
The dollar weakened despite expectations that the U.S. Federal Reserve might back off from raising rates by a full percentage point when it meets next week and, instead, stick with a raise of 75 basis points.
In turn, the European Central Bank may now be considering a 50-basis-point hike to its rates on Thursday, double what had been priced in, according to a Reuters report. That expected hike helped push the euro up on its largest one-day gain in a month.
In other precious metals, silver futures fell 0.11% to $18.685; platinum rose 0.38% to 865.05; copper rose 0.52% to $3.3105; and palladium rose 0.44% to $1,879.03.
Also helping keep gold down was a rally in shares in the U.S. on Tuesday after strong earnings reports helped Wall Street higher.
Reports that a deal could be near between Russia and Ukraine to end a blockade on grain exports and that the Nord Stream 1 gas pipeline out of Russia could restart this week as scheduled helped give markets a boost.
“There’s still a lot of uncertainty around whether they’ll actually materialize, [but] a little bit of good news goes a long way in this market,” Tai Hui, chief global market strategist for APAC at JPMorgan (NYSE:JPM) Asset Management, told CNBC.
