On Tuesday, in a choppy trading session in the global commodity market, the precious yellow metal gold futures’ prices plunged as much as 1.7 per cent, diving to a one-week low, as a rekindling of US Dollar’s safe-haven bid coupled with a rise in the US Treasury yields to a pre-pandemic level, wreaked havocs on a gauge of global commodities, while platinum was hit with a hefty whiplash following a profit-taking sell-off wave that hinged the precious commodity which has an upscaled significance in the manufacturing of low-emission automotive engines.
Platinum futures had hit a 6-1/2-year high later last week as analysts said that there had been signs of excessive speculative bets on the metal contracts over optimisms of a demand-surge due to a broad-based shift to low-carbon emission autos.
If truth is to be told, in the day’s downfall in global commodity market was largely catalysed by a stronger American Dollar which was pulled off from a three-week low over hopes of a near term economic recovery, while a remark from St.
Louis Federal Reserve Chair Bullard had depreciated a safe-haven bid of gold futures’ prices further. In factuality, speaking in an interview with CNBC earlier in the day, Fed’s Bullard was quoted saying that the US economy was performing “generally well” and inflation would be edged higher later this year, eventually breaking off a windshield of the bullion which has long been contemplated as a hedge against inflation.
Precious gold falls; platinum contracts hinge lower after hitting 6-1/2-year highs
Citing statistics, in the day’s commodity market winddown, spot gold fell 1.2 per cent to $1,796.50 an ounce after pommelling as much as 1.7 per cent earlier in the session, hitting the lowest since February 4, while US gold futures’ prices foundered 1.3 per cent to $1,799.00 an ounce.
Platinum futures faltered 2.9 per cent to $1,265.35 an ounce after hitting its highest level since the September of 2014. Among other precious metals, spot silver contracts curbed out 1.1 per cent to $27.29 an ounce, while palladium futures’ prices added 0.1 per cent to $2,391.33 an ounce.
Meanwhile, addressing to a steep headwind ahead for gold futures’ prices, a commodity strategist at TD Securities, Daniel Ghali said, “Gold is shifting away from being an inflation hedge asset, as has been the case for most of 2020, into a safe-haven asset once again. ”