NEW YORK: Gold rose to a two-month high on Monday bolstered by a retreat in the dollar and persistent inflation concerns after key central banks indicated that interest rates would remain low in the near term.
Spot gold was up for the third straight session, rising 0.3% to $1,821.60 per ounce by 10:25 a.m. ET (1525 GMT), after hitting $1,825.87, a peak since Sept. 7. US gold futures rose 0.3% to $1,822.70.
Boosting gold’s appeal for those holding other currencies, the dollar index eased 0.2%.
Major central banks are still overall accommodative, and all the cash in the system looking for a home is moving more into the gold and silver market as an inflation hedge, said Jim Wyckoff, senior analyst at Kitco Metals.
Bullion jumped nearly 2% on Friday after the US Federal Reserve maintained its view that “transitory” inflation would likely not require a fast rise in interest rates, while the Bank of England shocked markets by holding rates.
Gold, considered an inflation hedge, has been benefiting from an ultra-low interest rate environment to spur growth during the pandemic, since they translate into reduced opportunity cost of holding the non-yielding bullion.
However, worries that central banks will start tightening policy to combat rising prices have kept investors on the lookout for economic data.
Tightness in the labour market combined with dislocation in global supply chains could result in another high reading for US consumer prices due on Wednesday.
“Wednesday’s data is likely to favour gold as inflation could show the fastest rise since 1990,” likely triggering buying interest in bullion, said Sugandha Sachdeva, vice president of commodity & currency research at Religare Broking.
“Going forward, we see $1,865/oz levels as a short-term price target,” Sachdeva added.
Elsewhere, spot silver rose 0.7% to $24.35 per ounce. Platinum rose 2.4% to $1,059.50. Palladium gained 0.3% to $2,041.31 per ounce.—Reuters
Soyabean, corn futures sag before USDA crop report
CHICAGO: Chicago Board of Trade soyabean and corn futures drifted lower on Monday as traders adjusted positions before the release of key US Department of Agriculture crop and inventory forecasts.
Big US harvests, near-perfect weather for planting in Brazil and signs of slowing purchases by top buyer China are bolstering supplies for soyabeans and corn, two of the top globally traded commodities. In its monthly world supply/demand report on Tuesday, the USDA is expected to raise US soya and corn harvest forecasts sightly from October.
The agency is also expected to raise its projections for US and global 2021-22 soyabean ending stocks and trim its US and global corn carryout estimates.
Planting of Brazil’s 2021/2022 soyabean crop reached 67% of the estimated area through last Thursday, bolstered by favorable weather, consultancy AgRural said.
“Private analysts have started to raise their crop projections as conditions in all South American countries are quite favorable for growth,” said Karl Setzer, US commodity risk analyst for AgriVisor.
CBOT most-active soyabeans were down 5-3/4 cents at $11.90-3/4 a bushel by 9:25 a.m. CST (1525 GMT) and touched their weakest price since Oct. 13 in earlier activity. Corn was down 1 cent at $5.52 a bushel. CBOT most-active wheat was up 2-1/4 cents at $7.68-3/4 a bushel.
Wheat is seeing technical support after rising last week to its highest price since December 2012 at $8.07 a bushel, said Matt Ammermann, StoneX commodity risk manager. However, global demand looks quiet after large tenders by Saudi Arabia and Egypt last week, he said.
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