Prices of precious metals continue to decline on inflation data in the US and against the background of the strengthening of the US national currency, as a result, gold may end the first week of the last three in the red, MarketWatch reports.
Gold and silver “continue to trade in a strong inverse relationship with the strong dollar index,” said Jim Wyckoff, senior analyst at Kitco.com. At the same time, market bulls are surprised that precious metals do not attract investors as a “safe harbor” in the face of increased geopolitical and market uncertainty, he said.
Quotes of December contracts for gold on the Comex during trading on Friday decreased by 1.3% – up to $1654.9 per troy ounce. Silver for December delivery fell 2.8% to $18.39 an ounce. Since the beginning of the week, the cost of these precious metals has fallen by 3.1% and 8.8%, respectively.
December palladium futures fell 3% on Friday to $2,053.5 an ounce.
Meanwhile, the DXY index, which shows the value of the US dollar against six major world currencies, rose by 0.7% to 113.14 points.
Consumer prices (CPI index) in the US in September rose by 8.2% compared to the same month last year, showed data published on Thursday by the country’s Ministry of Labor. Thus, inflation slowed down compared to 8.3% in August, but turned out to be higher than the 8.1% expected by analysts.
Meanwhile, consumer price growth before food and energy (Core CPI) accelerated to 6.6% year-on-year last month from 6.3% in August, renewing a record since 1982.
“Inflation data was terrible for the yellow metal as it cemented a 75 basis point Fed rate hike next month. And with inflation looking so unwavering, the Fed will likely have to go further than markets previously expected,” he said. Oanda Senior Market Analyst Craig Erlam “This does not bode well for gold in the near term. Yesterday’s lows of around $1,640 an ounce could soon be tested again.”
