June 6, 2023

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Why did gold prices fall during today’s trade? By an Arab trader

© Reuters. Why did gold prices fall during today’s trade?

Arabictrader.com – today recorded a decline during trading on Tuesday; Coupled with US stability, a rise in US bond yields and US retail sales growth for April, released shortly after, reinforced expectations that the US Federal Reserve would continue to raise interest rates. Rates in the upcoming meetings will in turn affect the movements of both the US dollar and metal prices.

In today’s trade, spot gold contracts were down 0.30% at around $2,010.39 an ounce, while gold futures were down 0.33% at $2,016.10 an ounce.

In light of the inverse relationship between the two parties, the price of the yellow metal fell in today’s trade due to the stability of the US dollar index, which measures the performance of the US currency against a basket of six other major foreign currencies. In this context, the US dollar index recorded stability at the level of 102.192 points. This was due to the growth of US retail sales, which negatively affected the movement of gold prices.

In this case, the data released by the United States today showed that the growth of the US retail sales for April last year was only 0.4% on an annual basis, in order to strengthen the expectations that the US Federal Reserve will continue to raise interest rates. In a way that supports countries’ positions, then weakens the performance of gold, and despite its growth, it came in below market expectations, indicating a growth of 0.8%, and a correction from the previous reading of 0.7% by contraction, which raised concerns about the possibility of a correction in next month’s reading, which was today in the US Limiting the rise in the dollar index.

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Also, gold prices saw pressure during today’s trade as the 10-year US Treasury yield rose 0.74% to close at 3.534 points due to a rise in US Treasury yields. 20 years is about 0.95% and reached 3.9654 points. Likewise, the 30-year US Treasury rose 0.87% to 3.876 points, leading to lower gold prices today.

As for prices of other precious metals, spot contracts on the margins of trade today recorded a 0.49% decline to settle at $23.97.Furthermore, prices fell 0.51% to around $1,521.43, while platinum rose 0.17%. $1,068.79.

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