Gold futures closed higher on Tuesday (Jan. 1), with gold prices back above $1,800. This is a sign that gold continues to be in demand in these unclear times. Furthermore, the situation in Ukraine remains tense.
- Gold futures were up $5.10, or 0.3%, at $1,801.50 per ounce.
- Silver contracts were up 20 cents, or 0.9%, at $22.595 an ounce.
- The platinum contract was up $2.4, or 0.2%, at $1,023.20 per ounce.
- Palladium was down $9.30, or 0.4%, at $2,346.50 an ounce.
Investors continue to buy gold as a safe haven amid the conflict between Russia and the West over Ukraine. Mainstream reports say the U.S. government is in talks with Eastern European allies about sending American troops to the region to bolster confidence in NATO. In addition, Russia is also reported to have deployed troops along the Ukrainian border. The Ukrainian president, however, reiterates that the situation in Ukraine should not be overestimated and points to various Western media outlets that are pushing the issue in order to distract attention from other important domestic issues.
The weakening of the dollar also made gold contracts attractive to investors holding other currencies, with the dollar index falling 0.28% to 96.27 against the six major currencies in a basket of currencies.
The environment for short-term gold trading continues to be weighed down by concerns about a Federal Reserve (Fed) rate hike, which will increase the cost of holding gold, as gold is a non-interest-bearing asset. In the long run, however, there is probably no scenario that could keep gold prices from rising. Given the room for maneuver of central banks and the debt of governments around the world, in addition to the fear of a fall in stock markets, the decision makers are probably in a bind.
Investors are waiting for the U.S. non-farm payrolls figures on Friday. It is expected that the number of newly created jobs in January was only 178,000 and the unemployment rate is expected to remain stable at 3.9%.
However, the economic data from the U.S. published yesterday remain mixed. The ISM manufacturing PMI fell to 57.6 in January from 58.8 in December. However, the number of job openings rose to 10.925 million in December.
The Spot Market id Open
Wednesday, February 2, 2022