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Saturday, December 10, 2022
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Gold prices drop from a week’s high as Omicron concerns ease

Gold prices drop

Spot gold was down 0.1% at $1,808.91 per ounce, after having hit its highest since Dec. 17 on Monday, while U.S. gold futures were up 0.1% at $1,810.00

Gold prices dropped from a one-week high in thin trading on Tuesday, as easing concerns over the Omicron coronavirus variant and strong U.S. retail sales data boosted risk appetite.

Spot gold was down 0.1% at $1,808.91 per ounce by 0328 GMT, after having hit its highest since Dec. 17 on Monday, while U.S. gold futures were up 0.1% at $1,810.00.

There’s lack of participation. So, any little nugget of cross-market correlation is going to make markets move, said Stephen Innes, managing partner at SPI Asset Management.

What the crux of the argument will be, and probably limit gold’s upside momentum, is real rates, which could rise as the economy recovers from this little slip they’ve had on Omicron, he said.

Asian shares advanced, cruising in the slipstream of another record-setting day on Wall Street, while the safe-haven yen lost ground as traders stayed in riskier currencies and asset classes.

Crude oil prices gained ground on expectations the Omicron variant would have only a limited impact on global demand.

The U.S. dollar, also viewed as a safe-haven, languished near the bottom end of its recent trading range versus a basket of peers, maintaining the greenback-priced gold’s appeal for holders of non-U.S. currencies, and limiting losses.

The two-year Treasury yield, which is sensitive to interest rate expectations, climbed to the highest in nearly 22 months in Tokyo, increasing the opportunity cost of holding bullion, which pays no interest.

Meanwhile, Japan’s jobless rate rose to 2.8% in November, while the availability of jobs matched that of the previous month, government data showed.

Spot silver dropped 0.3% to $22.98 an ounce, platinum fell 0.5% to $966.02, and palladium shed 0.9% to $1,953.97.

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