PT KONTAK PERKASA – Gold futures failed an attempt at a third straight gain Thursday, as the latest round of economic data on jobs and inflation offered little to dissuade investors from buying assets perceived as risky over haven gold.
December gold GCZ8, -0.02% lost $1.10, or less than 0.1%, to settle at $1,219.90 an ounce, halting three straight gains. The commodity has mostly traded within a narrow band and is hovering around the lows of the year. It is down about 1.1% for August so far and off about 7% in the year to date.
September silver SIU8, -0.24% tacked on 3 cents, or 0.2%, to end at $15.462 an ounce. The white metal remains down nearly 10% so far in 2018, falling a sharp 4.2% in just the past 30 days.
A slightly firmer dollar limited gold’s upside and interest in riskier investment alternatives, as reflected in the stock market’s persistent march to fresh record highs, dulled some short-term attention on the precious metal.
As for the data, the overall producer-price index was flat but the measure preferred by economists, known as core PPI, rose 0.3% for the second straight month. Another report showed a drop in jobless benefits applications. With these reports and others largely tracking in line, the Federal Reserve is expected to increase interest rates twice more this year and three times next year. The next policy meeting is in September.
A popular metals exchange-traded fund, the SPDR Gold Trust GLD, -0.15% lost less than 0.1%. The comparable silver ETF, the iShares Silver Trust SLV, +0.14% added 0.2%.
With Fed action essentially baked in and dollar moves constrained of late, attention has fixed on the gold charts for mostly tactical moves.
“Buying the $1,207 support line and taking profits in the high teens has worked three times in the past week. In the doldrums of summer, it at a minimum keeps you awake,” said Peter Hug, global trading director at Kitco Metals Inc.
“Given that there has been no fundamental change in interest-rate differentials and no flare-up of geopolitical tensions, one would expect the market to be testing at a minimum the $1,200 line,” he said. “The longer we can hold above the $1,207 area, the higher-percentage bet, is that we may have put in the low for 2018.”
The ICE U.S. Dollar Index DXY, -0.07% was up 0.4% at 95.42 on Thursday afternoon. A stronger dollar can make purchasing dollar-pegged metals less attractive to buyers using other currencies.
Trade tensions, although doing little to buoy gold’s routine role as a haven asset, play out against an interest-rate backdrop that is negative in the short term for the gold market and is dollar-positive. Analysts are watching for signs that tariffs could hurt growth for economic engines such as the U.S. and China, perhaps impacting Fed decision-making.
Yet gold has traded under pressure this summer as riskier financial markets in the U.S. have remained relatively resilient despite trade tensions between Washington and Beijing lingering in the background.
On Wednesday, China warned that duties imposed by President Donald Trump’s administration on some $50 billion of Chinese imports set to be enacted on Aug. 23, would be matched.
In other metals markets, September copper HGU8, +0.07% added 1.4 cent, or 0.5%, less than to end at $2.7655 a pound. October platinum PLV8, +0.01% rose $4.60, or 0.6%, at $834.10 an ounce, while September palladium PAU8, -0.04% advanced $12, or 1.4%, to $898.40 an ounce.
Source : kontan.co.id