BULLION LATEST 10/01: Gold prices pressured by resurgent dollar, higher US bond yields

The spot gold price was recently quoted at $1,310.60-1,310.90 per oz, up by $0.70 from the previous trading day’s close. Trade has ranged from $1,308.40-1,312.55 per oz so far today.

• The spot gold price remained under pressure during the early session on Wednesday, with a firmer dollar and stronger equity market denting the appeal of the yellow metal.
• The dollar index was down by 0.1% at 92.44 as of 11.51am Shanghai time. However, the currency continues to push away from a low of 91.75 on January 2, having reached as high as 92.64 on Tuesday.
• “[A] stronger equity market is also taking some shine of gold as investors pare back early year equity market hedges as global stock equity markets remain on the ups,” Stephen Innes with Oanda said on Wednesday.
• “However, much of the [dollar] appeal is being expressed via the euro suggesting this mini dollar revival is little more than traders unwinding overextend EUR bets and with no evidence that the broader US dollar downtrend has run its course,” Innes added.
• Investors will be looking ahead to a raft of important data releases later this week – including the US consumer price index and retail sales due on Friday – for further direction in the dollar and conversely in the price of gold.

Silver, PGMs

• In the other precious metals, the spot silver price was up by $0.020 at $16.925-16.965 per oz. Platinum declined by $2 to $957-962 per oz, while palladium increased by $2 to $1096-1101 per oz.
• On the Shanghai Futures Exchange, gold for June delivery was recently at 280.10 yuan ($42.96) per gram, and the June silver was at 3,879 yuan per kg.

Currency moves and data releases

• The dollar index dipped by 0.1% to 92.44 as of 11.51 am Shanghai time.
• “The USD finally showed some mettle following the run of generally strong data over recent months,” ANZ Research noted on Wednesday.
• In equities, the Shanghai Composite Index was up by 0.35% to 3425.84 as of 11.30 am Shanghai time.
• In other commodities, the Brent crude oil spot price edged $0.01 higher to $69.15 per barrel as of 11.53 am Shanghai time and the Texas light sweet crude oil spot price increased by $0.11 to $63.44 per barrel.
• In data out already today, China’s December CPI came in at 1.8%, according to data released by the country’s National Bureau of Statistics. The reading was marginally lower than an expected reading of 1.9%, while slightly up from a print of 1.7% in November.
• Meanwhile, China’s PPI grew 4.9% in December, slightly higher than the expected 4.8% increase, but significantly lower than November’s print of 5.8%.
• Later, we have data that includes the UK’s manufacturing production, goods trade balance, and construction output and industrial production as well as US import prices, final wholesale inventories and crude oil inventories.