Gold Reaches One-Week High

Gold prices touched one-week high on Friday, as US dollar weakened and risk aversion due to geopolitical events sparked the appeal for the safe-haven metal.

Spot gold was up 0.3 percent at $1,254.11 per ounce, but was nearly flat for the week. US gold futures for August delivery rose 0.5 percent to $1,255.10 per ounce.
Among other precious metals, silver gained 1.1 percent to $16.72 per ounce. It was up 0.8 percent for the week.

US dollar drops versus majors

The dollar slipped against major currencies on Friday, especially versus euro which was supported by an upbeat quarterly eurozone growth reading.

The ICE U.S. Dollar Index was down 0.1 percent at 97.41.

“The uncontrolled oil price spill in the futures markets may have seen some traders pushing the risk aversion button and buying gold. The primary driver appears to be the flattening of the longer-dated U.S. Treasury curve,” said Jeffrey Halley, senior market analyst at OANDA.

The US dollar bought 111.22 yen, compared with 111.33 late Thursday in North America.

Oil prices bounce back

Oil prices recovered on Friday, after big producers expressed their intention to stick to output cuts.

August West Texas Intermediate crude rose 0.3 percent to $42.87 a barrel on the New York Mercantile Exchange.
Brent crude for August delivery on London’s ICE Futures exchange advanced 14 cents, or 0.2 percent to $45.33 a barrel.

“Brent and WTI may be higher for a second day but as it is, there’s little reason to believe this is anything more than a dead cat bounce and that next week may be another painful one,” said Craig Erlam, senior market analyst at OANDA.

Oil prices have fallen around 20 percent this year despite an effort made by the OPEC to cut production by 1.8 million barrels per day. That is the worst first-half performance for crude oil since 1997.

Leave a Reply

Your email address will not be published. Required fields are marked *