Gold on track to hit third monthly loss in a row
Gold prices fell in European trade for the fourth straight session to six-week lows as dollar climbs against a basket of major rivals.
The precious metal is heading for the third monthly loss in a row on weak demand on non-yielding assets and higher interest rates.
Prices Today
Gold prices declined 0.8% today to 1,802 an ounce, the lowest since May 16, after closing down 0.1% yesterday, the third loss in a row.
The Dollar
The dollar index rose 0.5% on Thursday, marking two-week highs at 105.54 against major rivals.
Markets continue to favor US bonds over gold amid bullish remarks by Fed Chair Jerome Powell's bullish remarks on interest rates this year.
Monthly Trading
Gold is down 2% so far in June on track for the third monthly loss in a row as global central banks move to control runaway inflation.
The Fed took a historic decision this month to hike rates by 0.75% to 1.75%, the highest hike since 1994.
Bank of England hiked rates by 25 basis points to 1.25%, the fifth such increase in a row.
Swiss Central Bank decided to hike rates by 50 basis points at the June 16 meeting to minus 0.25%, the first such increase since 2007, while analysts expected no change at minus 0.75%.
Higher interest rates weaken demand on gold prices as it becomes less attractive as an investment.
The SPDR
Gold holdings at the SPDR Gold Trust fell 1.74 tones yesterday, the seventh decline in a row to a total of 1,052 tones.
Euro sharpens decline to two-week lows on recession concerns
Euro fell in European trade for the third straight session against dollar to two-week lows amid concerns about global recession in Europe due to the Ukrainian war.
Prices Today
EUR/USD fell 0.15% on Thursday to 1.0415, the lowest since June 16, with a session-high at 1.0469.
Euro lost 0.75% on Wednesday, the second loss in a row off three-week highs at 1.0615.
Recession Concerns
Analysts predict a potential recession in the euro zone due to the ongoing Ukrainian crisis, even as the US economy proves more resilient.
The Dollar
The dollar index rose 0.1% on Thursday for the third straight session, hitting two-week highs at 105.19 against major rivals.
The gains come on haven demand amid concerns global recession, and after bullish remarks by Fed Chair Jerome Powell on hiking interest rates.
Monthly Trading
Euro is now down 2.9% so far in June on track for the fifth monthly loss in the last six months.
Palladium heads towards $2000 an ounce
Palladium prices climbed on Thursday as the dollar lost ground against most rivals and traders follow the latest political developments.
The G7 countries announced a new batch of sanctions this week against Russia for its invasion of Ukraine, including banning gold imports and putting a ceiling on natural gas and oil imports from Russia.
Therefore analysts expect a historic contraction in the Russian economy approaching 11.2% this year.
Russia is a major producer of palladium and other industrial metals, with carmakers in particular putting high demand on palladium for use in part manufacturing.
Dollar
The dollar index fell 0.1% to 104.9 as of 5:22 GMT, with a session-high at 105.1, and a low at 104.9.
It comes ahead of a batch of important S data later today, including personal spending levels, and unemployment claims.
Palladium futures due in September rose 1% to $1,966.5 an ounce as of 5:22 GMT.
Wall Street buoyed by Powell's remarks
US stock indices climbed today following remarks by Fed Chair Jerome Powell.
The European Central Bank is meeting emissaries from other global central banks today in Portugal to discuss strategies.
Fed Chair Jerome Powell said in earlier remarks the bank is able to bring inflation back to 2% while maintaining the strong state of employment.
Earlier data showed US economy shrank 1.6% in the first quarter of the year, more than the 1.5% drop expected, and compared to a 6.9% increase in the fourth quarter of 2021.
Dow Jones rose 0.5% to 31,107, while S&P 500 climbed 0.1% to 3,926, as NASDAQ added 0.2% to 11,201.