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Gold Poised for Second Straight Weekly Gain on Weaker Dollar, Rates

Summary:
Gold futures are rising to close out the trading week, helping the yellow metal get on track for a second consecutive weekly gain. Volatility in the metals market has stabilized as investors weigh global inflation, a weaker US dollar, and a resurgence in the coronavirus. But can gold prices retest ,000 again? The consensus on Wall Street is that the precious metal is still poised for big gains over the next 15 months. December gold futures surged .60, or 0.8%, to ,965.50 per ounce at 16:53 GMT on Friday on the COMEX division of the New York Mercantile Exchange. Gold prices are on track for a weekly jump of about 1%, lifting their year-to-date gains to around 30%. Silver, the sister commodity to gold, is also climbing to finish the trading week. October silver futures advanced

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Gold futures are rising to close out the trading week, helping the yellow metal get on track for a second consecutive weekly gain. Volatility in the metals market has stabilized as investors weigh global inflation, a weaker US dollar, and a resurgence in the coronavirus. But can gold prices retest $2,000 again? The consensus on Wall Street is that the precious metal is still poised for big gains over the next 15 months.

December gold futures surged $15.60, or 0.8%, to $1,965.50 per ounce at 16:53 GMT on Friday on the COMEX division of the New York Mercantile Exchange. Gold prices are on track for a weekly jump of about 1%, lifting their year-to-date gains to around 30%.

Silver, the sister commodity to gold, is also climbing to finish the trading week. October silver futures advanced $0.165, or 0.61%, to $27.265 an ounce. The white metal is also poised for a significant weekly increase of roughly 1.25%, enhancing its YTD rally to nearly 53%.

Metal commodities are finding support in a slumping greenback. The US Dollar Index, which gauges the greenback against a basket of currencies, tumbled 0.15% to 92.83, from an opening of 92.97. A weaker buck is good for dollar-denominated commodities because it makes it cheaper for foreign investors to purchase. The index will settle the week down more than 0.5%.

Gold is also gaining on the Federal Reserve pledging to leave interest rates lower for longer. This week, the US central bank finished its two-day September Federal Open Market Committee (FOMC) policy meeting and stated that it would allow inflation to climb above its 2% target rate, while also keeping rates near zero until at least 2023. This is bullish for non-yielding bullion since low rates reduce the opportunity cost.

Metal investors are also waiting for the US government to approve a $1.5 trillion coronavirus aid bill. Republicans and Democrats are a standstill, but it is unclear if financial markets have already priced in President Donald Trump signing the legislation.

Right now, The Street is forecasting that gold prices will average $2,000 in the fourth quarter of 2020 and $2,125 in 2021.

In other metal markets, October copper futures picked up $0.0425, or 1.38%, to $3.1135 per pound. October platinum futures added $6.30, or 0.68%, to $937.20 per ounce. October palladium futures tacked on $39.70, or 1.70%, to $2,375.00.


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Andrew Moran
I am a full-time professional writer. Prior to my self-employment, I worked as a reporter for Digital Journal covering the politics beat and The Toronto Times reporting on the city’s entertainment scene. I currently write mostly about business, marketing and finance

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