Gold prices ended lower on Thursday for a second day in a row, but posted a sixth straight weekly gain for the holiday-shortened week and remained within striking distance of the yellow metal’s all-time closing high for a most-active futures contract.
Price action
-
The June gold contract
GC00,
+0.45% GCM23,
+0.45%
declined by $9.20, or nearly 0.5%, to settle at $2,026.40 per ounce on Comex, with prices for the most-active contract up 2% for the holiday shortened week, according Dow Jones Market Data. Prices settled at $2,038.20 on Tuesday, the highest finish since March 2022. -
Silver futures for May delivery
SI00,
+0.77% SIK23,
+0.77%
rose 6 cents, or 0.2%, to $25.09 per ounce, up 3.9% for the week. -
June palladium
PAM23,
+1.09%
settled at $1,462.40 an ounce, up 2.6% for the session, but down 0.4% for the week, while July platinum
PLN23,
+0.36%
gained 0.9%, to $1,016.80 per ounce, logging a weekly gain of 1.4%. -
Copper for May delivery
HGK23,
+0.52%
added 0.7%, to $4.02 per pound, losing 1.9% for the week.
Market drivers
Gold’s pullback Thursday is “likely related to profit taking or a reluctance by bulls to take on new positions ahead of the long weekend,” said Colin Cieszynski, chief market strategist at SIA Wealth Management. The reluctance also comes with the “event risk” of U.S. nonfarm payrolls due out Friday, when most exchanges are either either closed or on a limited schedule, he said.
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“At this point, it’s hard to say if new catalysts are needed or if recent trends may resume along with normal trading on Monday or Tuesday,” said Cieszynski.
For now, gold prices have seen some pressure in the wake of comments by St. Louis Federal Reserve President James Bullard, who on Thursday downplayed concern over financial stress on the economic outlook and said that inflation remains too high. He also said recently that he thinks the Fed needs to continue to raise interest rates to a range of 5.5%-5.75% to put pressure on high inflation.
Gold futures briefly touched their highest intraday level in about 13 months on Wednesday, after settling at $2,038.20 on Tuesday, the highest most-active contract finish since early March 2022.
The investments in gold pushing it toward an all-time high are in response to “broader systemic events,” said Joseph Cavatoni, market strategist at the World Gold Council, in emailed commentary.
Gold futures have settled above $2,000 in the past three trading sessions and trade near the record-high most-active contract settlement of $2,069.40 from Aug. 6, 2020.
“Since the beginning of this week, we’ve seen a cut on oil production, which calls into question how the current economic situation and dollar strength will play out,” Cavatoni said. “This may mean the U.S. moves into a recession quicker than some market observers previously thought.”
There are also concerns the banking sector problems may not be finished, he said. “There are better places to put savings and asset allocation to preserve capital and gold fulfills that role.”
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