The shiny metal sets a new historical record at $1868.55 an ounce
The shiny metal advanced today, extending the gains recorded in the past sessions, setting a new historic record at $1868.55 per ounce, affected by the downbeat global growth outlook and supported by the sluggish fundamentals worldwide, where the yellow metal gained as demand for safe haven surged.
Spot gold inclined today after the opening in the Asian session at $1823.45 per ounce, where the metal returns to continue the upside journey amid slowing pace of recovery and rising fears, while concerns of another recession control investors and supported them to hold the metal in order to protect their wealth in light of the ongoing economic conditions. The metal set a new historical high today after the opening, while the metal recorded the low of $1821.30 per ounce and is currently trading around $1862.50.
The huge losses seen across the board supported the metal to trade higher today as we can see a massive equity selloff after the weak fundamentals yesterday, where major economies across the globe are reporting weakening performance in different sectors in addition to the rising inflation, adding more uncertainty in regards to the pace of recovery, which seems to be slowing in the second half, with deepening debt crisis in Europe and worsening outlook for growth.
The yellow metal continues the upside journey despite the several attempts from lawmakers to ease the tension and fears in the market in addition to the attempt of reducing the attractiveness of gold, where raising the margins on gold contracts affected the metal to trade lower, but as we expected the effect was temporary. Investors keep on holding the shiny metal despite the high margins due to the fears after the frequent huge losses seen across the board.
The weak fundamentals yesterday supported the negative outlook for growth and fueled the fears of contraction, while the yellow metal gained after spending levels in the U.K seem to be retreating, in addition the euro zone construction output dropped further. In the world's largest economy, inflation is still above the fed's target and advanced in July adding more pressures on the economy, while the initial jobless claims rose in the past week; moreover, the housing sector's performance unexpectedly retreated in July as existing home sales retreated to 4.67 million from the revised previous of 4.48 from 4.77 million and below the expected improvement to 4.90 million.
In Europe, the worsening debt crisis forced further pressures on the sluggish growth in the zone, where inflation are rising and growth is slowing, while lawmakers and central banks are unable to fix the situation as tightening monetary policy could support inflation to retreat, however, this will affect growth negatively, which is already slowing quickly.
Volatility and heavy fluctuations are expected today, while jitters and pessimism will remain highly effective in the market, as uncertainty is dominant and investors are to hold more shiny metal until signs of advancement is seen in regards to the debt crisis and the weak growth across the globe.
Among other precious metals, silver extended the losses seen in the past sessions, where after the sharp volatility seen yesterday, the metal closed in New York session at $40.50 an ounce. The metal opened the session today at $40.57, and recorded the high of $41.40 and the low of $40.49, and is currently hovering around $41.20 an ounce.
Platinum also surged today after the opening of $1843.00 per ounce, recording a high of $1846.00 and a low of $1829.00, and is currently trading lower than the shiny metal at $1846.00 per ounce.