Gold chalks up best week in 4 months amid softer Dollar; 10-yr bond yields at 1.56%

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Gold chalks up best week in 4 months amid softer Dollar; 10-yr bond yields at 1.56%

On Friday, the precious safe-haven gold futures’ prices racked up a seven-week peak and clocked their best weekly performance since mid-December, buoyed up by a broad-based weakness in US Dollar alongside a sharp drop in US Treasury bond yields which had been bottomed to a one-month low in the previous session.

On the technical viewpoint, gold futures’ blowout rally this week came forth amid a flurry of upbeat US economic data, as ebbing US Treasury bond Yields appeared to be holding back the greenback against most major currencies, while a decline in 10-year US Treasury bond notes below 1.60 per cent had enabled spot gold futures’ to break above their 50-day simple moving average (SMA) with US Dollar Index (DXY) measured against a basket of six major currencies on an average pummelled 0.13 per cent to 91.50.

In the physical market front, China, the world’s largest gold importer, had issued licenses for large domestic and international lenders to import massive amount of gold following a record quarterly rise in GDP (Gross Domestic Product) growth reported earlier this week, heating up a gold-buying frenzy further.

Gold futures rise over 2% in the week as US Dollar plunged

Citing statistics, in the day’s commodity market closure, spot gold futures’ prices rose 0.8 per cent to $1,775.04 per ounce after hitting a session high of $1,783.55 earlier in the day, the strongest level since February 25, while US gold futures’ prices closed out 0.8 per cent higher to $1,780.20 an ounce.

On the week, spot gold futures gained as much as 2 per cent. Among other precious metals, silver futures gained 0.6 per cent to $26.01 an ounce and wrapped up the week 3 per cent higher, while palladium contracts rose 1.2 per cent to $2,773.92 and surged as much as 5 per cent over the week.

Platinum contracts, in tandem, ended the session 0.8 per cent higher to $1,202.32 an ounce. Meanwhile, addressing to an improvement in key fundamentals for gold futures’ prices outlook, a senior market analyst at OANDA, Edward Moya said, “The macro argument for gold has also improved.

We are poised for a run towards $1,800. We've had many investors abandon some positions because of some extreme technical selling we saw with Treasury yields and that has really provided a strong backdrop here for gold prices to continue to appreciate.