Gold’s post-Federal Reserve rally continued on Tuesday with the yellow metal on track to climb for a fifth straight session which would be the longest winning streak for a most-active contract since at least April.
What is the market doing ?
expiring in December climbed $4.20, or 0.2%, to $1,791.90, its highest level since July 5.
expiring in September shed 11 cents, or 0.5%, to $20.26.
contracts expiring in September shed $27.90, or 1.3%, to $2,171.50.
retreated five cents, or 1.3%, to $3.495 per pound.
What analysts are saying
Gold prices have surged by roughly $100 per ounce over the past week from their lowest level since early 2021. Analysts have credited Federal Reserve Chairman Jerome Powell’s comment that the pace of interest rate hikes would likely slow with benefiting gold at the expense of the dollar, and Treasury yields, both of which have moved lower in the wake of Wednesday’s Fed meeting.
On Tuesday, gold benefited from a different tailwind: House Speaker Nancy Pelosi’s visit to Taiwan.
Fears that Pelosi’s planned trip — coming in the wake of a tense and “candid” phone call between President Joseph R. Biden and President Xi Jinping — could seriously strain the bilateral relationship between Washington and Beijing and helped to rattle markets on Tuesday, pushing the Japanese yen
higher while the dollar and U.S. equity futures tumbled. The dollar was off 0.5% at 130.97 yen.
“Risk sentiment took a knock on Tuesday as it emerged that the Speaker of the US House of Representatives Nancy Pelosi is on her way to Taiwan, defying China’s strong advice against visiting the disputed territory,” wrote Raffi Boyadjian, lead investment analyst at XM, in a morning markets note.