Gold falls to start August as U.S. dollar advances
NEW YORK (August 1) Gold and silver prices kicked off August in the red as the appreciation of the U.S. dollar in the past two weeks weighed on precious-metals prices.
Price action
- Gold futures expiring in December GC00, -1.21% GCZ23, -1.21% declined by $17.80, or 0.9%, to $1,991.40 per ounce on Comex.
- September silver futures SI00, -2.33% SIU23, -2.35% fell by 39 cents, or 1.6%, to $24.58 per ounce.
- Palladium futures for September PA00, -2.75% PAU23, -2.83% declined by $9.10, or 0.7%, to $1,266 per ounce, while platinum futures for October PLV23, -2.38% fell by $10, or 1%, to $948 per ounce.
- Copper futures HGU23, -1.25% fell by 3 cents, or 0.8%, to $3.97 per pound.
Market drivers
Gold prices rose in July, snapping a two-month streak of losses, and recording their biggest such gain since March, according to Dow Jones Market Data, but the recovery of the U.S. dollar has limited gains in the past week.
“The US dollar is pushing higher again this week which is weighing heavily on gold prices currently,” said Manoj Ladwa, director at ARJ Capital, in emailed commentary.
The ICE U.S. Dollar Index DXY, a gauge of the dollar’s strength against a basket of rivals, increased by 0.4% to 102.22 on Tuesday.
“Despite the market no longer pricing in any further Fed rate hikes this year, the drive seems to be linked to the resilience of the US economy, as shown through recent data strength,” Ladwa said.
U.S. economic strength has been an important theme for global markets in 2023. The latest U.S. data on GDP showed the economy expanding by 2.4% during the second quarter, a faster pace than expected.
Earnings for the largest U.S. companies have also been well received with nearly 80% of S&P 500 index companies that have reported earnings so far for the quarter surpassing expectations, above the historical average, according to data from Refinitiv.
Traders are looking ahead to Friday, when the next U.S. monthly jobs is due out from the Department of Labor. Economists expect the data to show 200,000 new jobs were created in June.
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