Metals Prices Continue Recovery as Gold Price Shines Amid Dollar Weakness
New York (Aug 20) Metals prices continued to recover, led by a rise in the Chinese yuan on reports the U.S. and China were looking to resolve their tit-for-tat trade war as soon as November.
Gold futures for August delivery on the Comex division of the New York Mercantile Exchange rose by $10.40, or 0.88%, to $1,194.60 troy ounce.
The bright start to the week for gold prices comes as a rising CNY/USD pointed to signs of optimism for positive progress on "low-level" trade talks between the United States and China due this week. The talks could pave the way for both countries to end the trade war as early as November, when President Trump is slated to meet with Chinese counterpart Xi.
"The fact that the Chinese yuan has stopped depreciating and has been on the up again for the last three days appears to be playing a role [in supporting metal prices]," Commerzbank (DE:CBKG) said.
Also lending support to gold prices was a retreat in the greenback from session highs as reports surfaced Monday that Trump criticized Fed chairman Jerome Powell for ongoing increases in interest rates. Trump over the weekend reportedly said that he expected Jerome Powell to be a cheap-money Fed chairman.
The Federal Reserve has projected four hikes for this year, with the third rate hike expected as soon as September.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, fell by 0.17% to 95.84.
Dollar-denominated assets such as gold are sensitive to moves in the dollar. A fall in the dollar makes gold cheaper for holders of foreign currency and raises demand.
Signs of optimism for improved U.S.-China relations boosted copper prices, which fell into bear-market territory last week, and sent platinum prices sharply higher.
Copper prices rose 1.45% to $2.67, while zinc prices fell 0.07% at 2,378.50.
Aluminium prices rose 1.22% to 2,058.50, while nickel futures rose 0.35% to 13,600.00.
Silver futures rose 0.33% to $14.68 a troy ounce, while platinum futures rose 1.97% to $792.60.
Investing.com
