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Gold prices settled higher on Tuesday as worries about the banking sector eased following back-to-back losses for the precious metal.
Price action
-
April gold futures
GC00,
+1.07% GCJ23,
+1.07%
gained $19.70, or 1%, to settle at $1,973.50 per ounce on Comex. -
Silver for May delivery
SI00,
+1.08% SIK23,
+1.08%
rose by 28 cents, or 1.2%, to $23.42 per ounce. -
Palladium for June delivery
PAM23,
+0.78%
climbed by $10.60, or nearly 0.8%, to $1,414.70 per ounce, while most-active platinum for July delivery
PLN23,
-0.96%
fell by $10.60, or 1.1%, to $971.90 per ounce. -
Copper for May
HGK23,
-0.21%
delivery added a penny, or 0.2%, to $4.0855 per pound.
Market drivers
Gold prices gained on Tuesday following two consecutive session losses.
“Investor appetite for gold has been dampened by a combination of technical and fundamental forces,” said Lukman Otunuga, manager, market analysis at FXTM.
“After kissing the psychological $2,000 level three times last week, bears have exploited this stubborn resistance to attack, with easing banking fears further dulling the metal’s safe haven allure,” he said in a market update. “While prices could trade lower in the shorter term to medium term, the longer term still remains in favour of bulls due to expectations around the [Federal Reserve] cutting interest rates in September.”
Data from the Conference Board Tuesday showed that a survey of U.S. consumer confidence rebounded slightly in March to 104.2 from a revised 103.4. The index remains well below the levels associated with a healthy economy. Inflation expectations remain high, with Americans expecting prices to rise 6.3% in the next 12 months.
Read: Fed’s Barkin says high inflation made case for rate hike ‘pretty clear’
Last week, the central banks “raised interest rates with one hand while handing out liquidity to banks with the other,” said Alex Kuptsikevich, FxPro senior market analyst, in emailed commentary.
“We saw a similar shift in Fed monetary policy in the past at the end of 2018, when the two-year gold rally began,” he said. “The subsequent two-year sideways rally and pullback to $1,600 have made gold attractive again for long-term buyers as a slowdown in the pace of Fed rate hikes looms on the horizon. A change in the central bank’s rhetoric promises a fresh impetus for buying.”
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