Connect with us

Hi, what are you looking for?

The Smart Citizen Report

BREAKING NEWS

Gold at Cusp of $1,800 in Belated Response to U.S. Inflation Spike

Commodities2 hours ago (Oct 13, 2021 03:20PM ET)

(C) Reuters.

(updates with settlement prices)

By Barani Krishnan

Investing.com – Gold jumped $35 an ounce, or 2%, to approach the key $1,800 level on Wednesday in response to weeks of surging oil and other commodity prices.

The rally was apparently triggered by latest U.S. CPI data that proved to be another affirmation of inflation in the world’s largest economy.

After weeks of being stuck in the mid-to-lower $1,700 levels, the move helped validate to some extent the “safe-haven” and ‘inflation hedge” labels typically applied to the yellow metal, which many investors see as the last resort in times of political and financial troubles.

“A Jekyll and Hyde inflation report sent gold prices on a wild ride,” Ed Moya, analyst at OANDA, said, referring to the CPI report. “Longer lasting inflation just went from rushing interest rate hikes forward to destabilizing large parts of the global economic recovery.”

Moya noted that markets this week went from pricing in a potential December 2022 U.S. rate hike to having high confidence that September 2022 will be the so-called lift-off time for the Federal Reserve.

U.S. gold futures’ most active contract, December, settled at $1,794.70 per ounce on New York’s Comex, up $35.40, or 2%. The session peak was $1,797.30.

The last time gold crested at $1,800 was on Sept. 15.

Wednesday’s rally came after the Labor Department reported that consumer prices in the United States rose by 5.4% in the year to September as rallying commodity markets from oil to coffee kept the pressure up on the world’s largest economy.

On Tuesday, the International Monetary Fund cut its outlook for 2021 world growth to 5.9% from a previous forecast of 6%, saying the momentum for the global economy has weakened while uncertainty has increased.

The IMF is also concerned that surging commodity prices will force central banks into tightening cycles that could trigger selloffs in global equities. Oil prices at seven-year highs of above $80 per barrel is pushing some central banks to consider raising interest rates quicker than they had previously planned.

While gold appeared to have a tentative resistance at $1,800, “that might not prove to be too difficult to breach if risk aversion runs wild”, Moya said.

Gold at Cusp of $1,800 in Belated Response to U.S. Inflation Spike

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Join Our Time-Limited Free Subscription! Get Latest Trading Ideas, Business Info and Market Stocks.

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

You May Also Like

Editor's Pick

 Going Full Liberal In response to the arrest of a man who walked into a cafe holding a baseball bat and screaming through a megaphone, a...

BREAKING NEWS

Cryptocurrency1 hour ago (Mar 15, 2021 05:00AM ET) XRP Price Prediction if It Wins Lawsuit 2020 was a striking year for cryptocurrencies as it...

BREAKING NEWS

World50 minutes ago (Jul 23, 2021 08:52AM ET) (C) Reuters. FILE PHOTO: A medical worker prepares a syringe at a coronavirus disease (COVID-19) vaccination...

Editor's Pick

Going Full Liberal More trouble for creepy Joe. An extensive new survey by Morning Consult of nearly 28,000 registered voters presents some troubling numbers for the...

Editor's Pick

Going Full Liberal National Public Radio (NPR) posted a tweet Saturday urging every reader to begin “decolonizing your bookshelf.” According to NPR, “white voices...

Editor's Pick

Going Full Liberal The liberal plan?  Get the body count as high as possible to hurt Trump.  These people are disgusting. Last week, the...

Editor's Pick

Going Full Liberal Liberal brilliance on full display. New York City appears to have experienced a surge in shootings this week after the New...

Editor's Pick

Going Full Liberal In the past few weeks, demonstrators — mobs, really — have destroyed or defaced the following statues across the United States....

Disclaimer: TheSmartCitizenReport.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice.

The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

© Copyright 2021,TheSmartCitizenReport.com All Rights Reserved