BULLION LATEST 04/10: Gold edges higher as dollar weakens

The spot gold price inched higher during Asian morning trading on Wednesday October 4 as the dollar weakened.

The spot gold price was quoted at $1,275.15-1275.60 per oz as of 04:00 BST, up $3.10 on the previous session’s close. Trade has ranged from $1,271.90 -1,276.25 so far today.

  • A pause in the dollar’s recent rebound has eased the pressure on gold, resulting in some slight gains for the yellow metal this morning.
  • The dollar weakened on Wednesday morning on speculation that the next US Federal Reserve chair may be a less hawkish candidate than previously thought. Gains on the dollar stalled after Politico reported that US Treasury Secretary Steven Mnuchin favours Fed governor Jerome Powell over former governor Kevin Warsh.
  • “With China on holiday this week, we would expect precious metals to be subdued in Asia. However, volatility should pick up in North America as we head into a data-heavy end of the week,” Jeffrey Halley, senior market analyst at Oanda noted.
  • Investors will be looking ahead to key US data releases this week, including Wednesday’s ADP non-farm employment change as well as Friday’s blockbuster non-farm employment change release, which could affect currency moves.

Silver, PGMs

  • In the other precious metals, the spot silver price climbed $0.113 to $16.710-16.755 per oz. Platinum increased $6 to $914-919 per oz while palladium was also up $7 at $921-926 per oz.
  • There is no trading on the Shanghai Futures Exchange as Chinese markets are closed from October 2-6 due to China’s week-long National Day holiday.

Currency moves and data releases

  • The dollar index was down 0.2% to 93.38 as of 02:57 BST after reaching as high as 93.92 on Tuesday, which was the highest since August 17.
  • In other commodities, the Brent crude oil spot price fell 0.14% to $55.62 per barrel as of 03:07 BST.
  • In EU data on Tuesday, Europe’s August producer price index rose 0.3% against a forecast 0.1% increase. The UK’s Construction purchasing managers’ index (PMI) for September was 48.1, down from the initial forecast of 51.1
  • The economic agenda today sees a host of services PMI data out across Europe, the UK and USA. Other US data of note includes the ADP non-farm employment change, the ISM non-manufacturing PMI and crude oil inventory figures.
  • In addition, European Central Bank president Mario Draghi and US Federal Reserve chair Janet Yellen are speaking later.
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