Precious metal prices dipped as dollar climbed
Gold prices today eased their gains, as the federal currency is climbing versus major currencies on anticipations that China will continue to take actions to limit financial institutions lending as a way to avoid another credit crisis which was believed to be the worst since the Great Depression.
When there are worries in the markets regarding the financial system, investors tend to turn away from higher yielding assets and more towards lower yielding assets, which therefore supports the dollar in the markets against major currencies.
Yesterday, gold rose $5.60 or 0.51% to close at $1098.20 an ounce as the dollar lost strength six major currencies which are measured by the Dollar Index, declined Monday to close at 78.18 while recording a high of 78.33 and a low of 78.02.
Among other precious metals; platinum is traded at $1515.40; palladium at $429.00; silver at $16.90; while, copper is at $333.75. Turning to commodity futures we see yesterday, S&P GSCI closed at 504.54 points recording a high of 505.44 points and a low of 500.13 points while RJ/CRB Commodity closed at 276.74 points recording a high of 277.09 points and a low of 275.56.
SPDR gold trust, the largest exchange-traded fund backed by bullion in the world, stood steady at 1,111.92 metric tons yesterday. Gold was set in London on Monday at $1095.25 per ounce declining from $1103.50 per ounce during the AM fixing.
In addition, stocks in Asia declined for the seventh consecutive day marking the longest declines in a row since two years, as a result of worries regarding the financial institutions in China as mentioned earlier.
Turning to oil, we see that prices are declining after the fourth largest oil importer, South Korea, said that economic growth eased while stocks in China declined therefore the commodity producer company stocks fell, which meant that oil prices dipped.
Currently, spot gold is traded at $1093.26 an ounce recording a high of $1103.35 an ounce and a low of $1091.95 an ounce.