Gold bounces after 7th straight monthly loss
NEW YORK (Nov 1) Gold futures rose Tuesday, kicking off November with a bounce after posting a seventh straight monthly loss in November.
Price action- Gold for December delivery GC00, 1.01% GCZ22, 1.01% rose $16, or 1%, to $1,656.70 an ounce on Comex. The yellow metal suffered its seventh straight monthly fall in October based on most actively traded contracts, marking its longest such streak since 1982.
- December silver SIZ22, 4.40% rose 78.1 cents, or 4.1%, to $19.90 an ounce.
- January platinum PLF23, 2.78% rose 2.2% to $950.40 an ounce, while December palladium PAZ22, 4.47% gained 2.2% to $1,872 an ounce.
- December copper HGZ22, 3.45% was up 2.8% at $3.469 a pound.
Gold has been pressured this year as the Federal Reserve has aggressively raised interest rates in its bid to squelch inflation, driving up Treasury yields and the U.S. dollar. Rising yields raise the opportunity cost of holding nonyielding assets like gold, while a stronger dollar makes commodities priced in the unit more expensive to users of other currencies.
Treasury yields were moving lower Tuesday, while the ICE U.S. Dollar Index DXY, -0.63% was down 0.6%.
The Fed is widely expected to deliver another supersize 75 basis point, or 0.75 percentage point, rate increase when it concludes a two-day policy meeting Wednesday. But investors will be looking to remarks by Fed Chair Jerome Powell for clues to the size of a December rate move, with expectations running high that he may hint at smaller increases ahead.
“Gold retreated to $1633 by the start of this month, close to the lows of September and October, but gained about 1% surpassing $1650. We saw a similar buying spree the month before, and such buying activity looks like a reversal to the upside,” said Alex Kuptsikevich, senior market analyst at FxPro, in emailed comments. “However, in the current circumstances, it is better to wait for the price to surpass $1700, confirming a bullish reversal.”
“While central banks are signaling one after the other that they are decelerating their rate hikes, gold is enjoying ‘buying the dip’ behavior, as some investors see the current prices at the bear market’s edge (-20% of the peak) as attractive for buying in the mid-to-long term,” he wrote.
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