On Friday (Mar 10), gold futures closed higher, as buying pressure rose due to concerns about problems in the US banking sector following the closure of Silicon Valley Bank (SVB). Additionally, a weak dollar and lower bond yields after the release of slow employment data helped support the purchase of gold.
- Gold futures rose $32.60, or 1.78%, to close at $1,867.20/ounce, up 0.7% for the week.
- Silver futures rose 34.10 cents, or 1.69%, to close at $20.506/ounce.
- Platinum futures rose $12.90, or 1.36%, to close at $962.20/ounce.
- Palladium futures were down $12.40, or 0.9%, at $1,362.30 an ounce.
The closure of SVB raised concerns about its impact on the banking sector, encouraging investors to buy gold as a safe investment source. Furthermore, the US Department of Labor’s data showing an increase in unemployment in February supported gold futures. Non-farm payrolls rose by 311,000 in February, above analysts’ expectations of 225,000 but slowed from 504,000 in January. The unemployment rate rose to 3.6 percent, above analysts’ expectations of 3.4 percent.
The falling Dollar Index and Treasury Yields after the disclosure of US employment data also supported the price of gold. The dollar’s depreciation made gold contracts, priced in dollars, cheaper for investors holding other currencies, while the yields on US government bonds that fell reduced the opportunity cost of holding gold.
Investors are now awaiting the release of the US Consumer Price Index (CPI) next Tuesday (March 14) for any indication of how much the Federal Reserve (Fed) will raise interest rates at its monetary policy meeting this month.
The Spot Market is Closed
Saturday, March 11, 2023