Title: Gold edges up as economic worries lend support
Jul 05, 2022 01:46AM ET
Gold prices edged higher Tuesday, supported by concerns over economic growth, although a higher dollar and impending interest rate hikes kept gains in check.
At 01:01 AM ET, spot gold was 0.1% higher at $1,810.45 per ounce. U.S. gold futures were up 0.6% at $1,812.20 an ounce.
"While we are stuck in the $1,790 to $1,830 range, gold could be supported by recession worries and a possible softening of Federal Reserve policy as the market turns away from inflation concerns," said Stephen Innes, managing partner at SPI Asset Management.
Gold is considered a safe store of value during times of economic crisis, such as a recession.
Gold prices have been pressured in recent months by major central banks around the world raising interest rates in an effort to curb runaway inflation.
Overall, the gold price's performance remains unconvincing, as it has posted a series of lower daily highs over the past month, suggesting that the downtrend is the weaker path, according to Jeffrey Halley, senior analyst at OANDA.
The overall decline in U.S. yields appears to be delaying the inevitable downward correction in non-yielding gold prices, Halley said.
As trading resumed after a weekend extended by Independence Day, yields on 10-year U.S. Treasury bonds recovered slightly from Friday's one-month low, but remained below 3%.
The dollar hovered near a two-decade high and continued to weigh on demand for gold held in other currencies.
Meanwhile, Asian stocks edged higher as upbeat economic data and hints of easing tensions between China and the U.S. offered some respite from recent sell-offs, although lingering fears of a global recession and sky-high inflation kept most buyers at bay.
Spot silver rose 1% to $20.16 per ounce, while platinum fell 0.4% to $882.50 and palladium climbed 1.1% to $1,943.16.