August 11, 2022

Dubai Week

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Why did the price of gold rise sharply for the third day in a row?

High gold

Gold prices rallied strongly during trading today on Friday and continued their third straight day of gains, especially after the US Federal Reserve’s decision to raise interest rates by only 75 basis points last Wednesday, boosting demand for the yellow metal and weakening significantly. US dollar in trade.

During today’s trade, spot gold contracts were up 0.59% at $1766.28 an ounce. Meanwhile, gold futures settled at $1,763.85 an ounce, up 0.77%.

The dollar index, which measures the performance of the US currency, fell below 106.00 points during today’s trade, down about 0.71% to 105.59 points, and due to the inverse relationship between the two sides, gold prices were affected. Due to the strength of the US dollar.

In light of the US Federal Reserve’s decision last Wednesday to raise US interest rates by only 75 basis points due to its fears, gold prices rose strongly, bolstering calm confidence that US monetary policy is tightening at a faster pace. An American recession.

In light of high US inflation and the prospect of the US Federal Reserve not accelerating the pace of interest rate hikes for the rest of the year, gold found strong support and started to regain its luster and edged higher towards the level. 1770 dollars per ounce.

In addition, yesterday, Thursday, negative US economic growth data contributed to the rise of gold in full strength, as it strengthened fears of a slowdown in the US economy, the summary of the estimated reading of the gross domestic product in the United States showed. US economic growth in the second quarter of the year was 0.9%, which contrasted with expectations for 0.4% growth, and the index’s previous reading showed the index contracted 1.6% in the first quarter. year.

Also, gold found support from negative data on US jobless benefits for the new week, as the number of US jobless claims reached around 256 thousand new applications, which was higher than expected which recorded 253 thousand applications. More than the previous reading of 251 thousand new applications. Converted to 261 thousand requests.

In metals prices other than gold, silver contracts rose 1.21% to trade around $20.108 an ounce in early trade, while palladium contracts fell 0.26% to around $2072.00 an ounce. Platinum metal contracts rose about 1.02% to settle at $889.40 an ounce.

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