BULLION LATEST 21/12: Gold price rises on weaker dollar

The spot gold price inched higher during Asian morning trading hours on Thursday December 21 after the US dollar index fell to its lowest level since early December.

The spot gold price was quoted at $1,267.6-1,267.9 per oz as of 11.09 Shanghai time, up $1.5 on yesterday’s close. Trade has ranged from $1,266.15 to $1,268.4 so far.

  • The gold price rose on a weaker US dollar. The US dollar index fell to 93.151 overnight, hitting its lowest level since December 5.
  • Weaker equity markets also helped to redirect investors’ focus back to the yellow metal.
  • The US tax reform was approved by Congress yesterday. However, “US equity markets failed to cheer as recent gains had preempted this outcome”, noted Credit Suisse.
  • Overnight, US equities finished broadly lower with the Dow dropping 28.10 points to 24,726.65, the S&P 500 falling 2.22 points to 2,679.25 and the Nasdaq moved 2.89 points lower to 6,960.961.
  • “Gold prices inched higher as investor appetite waned. ETF holdings in the SPDR fund fell for the second day to its lowest level in three months,” ANZ Research said.

Both silver and PGMs stronger

  • In the other precious metals, the spot silver price rose $0.047 to $16.195/16.230 per oz. Platinum gained $3 to $917/922 per oz and palladium was up $1 at $1,025/1,030 per oz.
  • On the Shanghai Futures Exchange, gold for June delivery was recently at 274.85 yuan ($41.75) per gram, and the June silver was at 3,803 yuan per kilogram.

Currency moves and data releases

  • The dollar index was up by 0.03% at 93.34 as of 11.09am Shanghai time.
  • In other commodities, the Brent crude oil spot price dipped 0.03% to $64.44 per barrel while the Texas light sweet crude oil spot price inched up 0.03% to $58.04.
  • In data on Wednesday, China’s CB Leading Index in November gained 1.8%, above the previous mark of 1.3%. In the United States, existing homes sales topped estimates with a 5.81 million reading.
  • Today comes with a heavy US economic data schedule, including the latest GDP revision, the Chicago Fed National Activity Index and the Philadelphia Fed Manufacturing Index numbers, as well as the latest Personal Consumption Expenditures (PCE) prices.
  • In addition, EU flash consumer confidence numbers are due out later today.
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