Offsetting macroeconomic and market factors are pulling gold and silver prices in both directions as key correlations break down – HeraeusKitco NEWS has a diverse team of journalists reporting on the economy, stock markets, commodities, cryptocurrencies, mining and metals with accuracy and objectivity.
“Since around the year 2000, gold has exhibited a relatively strong inverse relationship with yields on the 10-year US Treasury note,” they said. “This is to be expected as the non-yielding nature of bullion means that as the coupon paid on very low-risk US government debt rises, the opportunity cost of holding gold also rises, and the interest in buying falls.”
Drilling down into gold’s recent price performance, Heraeus noted that receding tensions in the Middle East have sapped the precious metal’s momentum. “Gold had retreated to $2,337/oz by Friday, after experiencing the largest one-day drop in two years earlier in the week,” they said. “Two failed attempts to gain a foothold above $2,400/oz signalled the start of the correction, though there are upside factors that could push prices higher again.”helped support gold prices.
Turning to silver, the Heraeus analysts noted that the supply of the gray metal is expected to decline even though Mexico’s production is recovering. “Global silver supply is forecast to fall by ~1% this year to 824 moz, from 831 moz last year , marking the second year of decline,” they wrote.
Silver prices have spent most of the session in positive territory on Monday, with spot silver last trading at $27.285 per ounce, up 0.41% on the day.
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