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Gold prices surged on Monday, hitting a 4-week high as the U.S. dollar weakened and Treasury yields declined after the Federal Reserve and other U.S. authorities stepped in to try and prevent a banking crisis from spreading.
Price action
-
Gold prices for April delivery
GC00,
+2.28% GCJ23,
+2.28%
gained $26, or 1.5%, to $1,894 per ounce on Comex. -
Silver prices for May delivery
SI00,
+5.68% SIK23,
+5.68%
rose by 72 cents, or 3.6%, to $21.24 per ounce. -
June palladium
PAM23,
+5.01%
gained $31.20, or 2.3%, to $1,393 per ounce, while platinum for April
PLJ23,
+4.12%
gained $14.10, or 1.4%, to $975 per ounce. -
Copper for May
HGK23,
-0.69%
delivery declined by 4 cents, or 1.1%, to $3.98 per pound.
Market drivers
Gold and silver were benefiting on Monday from both lower Treasury yields and heightened demand for safe-haven assets, precious metals analysts said.
“Gold has been one of the few beneficiaries from the collapses of first Silvergate and then Silicon Valley Bank with the precious metal’s safe haven appeal seeing its price surge to close to $1,900 an ounce,” said Rupert Rowling, a market analyst at Kinesis Money.
On Sunday evening, U.S. authorities stepped in to announce they would backstop deposits at Silicon Valley Bank and Signature Bank, which was seized over the weekend after it suffered its own wave of deposit flight. The Fed also announced a new program for supplying liquidity to banks.
The yield on the 10-year Treasury note
TMUBMUSD10Y,
has fallen 23 basis points to 3.471%. The ICE U.S. Dollar Index
DXY,
a gauge of the greenback’s strength against a basket of rivals, was off 0.3% to 104.22.
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