Gold surges 1.5pc
NEW YORK: Gold soared to a nine-year peak on Tuesday, boosted by a dollar sell-off and expectations for increased stimulus to aid the recovery of pandemic-hit economies, while silver dashed past the $20 threshold to an over six-year high.
Spot gold rose 1.5% to $1,842.52 per ounce by 1:49 p.m. EDT (1749 GMT). It hit its highest since September 2011 and was track to post its biggest daily gain since early May.
US gold futures settled up 1.5% at $1,843.9.
“The US dollar has dropped as the world is looking a little bit better,” said Bart Melek, head of commodity strategies at TD Securities. “Interest rates have fallen across the yield curve and that again is another factor helping gold,”
The US dollar, viewed as safe-haven rival to bullion, hit more than a four-month low.
US congressional leaders are set to discuss a fresh stimulus package this week, and European Union leaders clinched a “historic” deal on a massive stimulus plan on Tuesday morning.
Gold will push toward record highs over the next 18 months, a Reuters poll showed, while low jewellery sales in Asia and the prospect of economic recovery will hinder further gains.
“As economic uncertainty fades, demand for safe-haven assets including gold should fall. However, this is only likely to take a little shine off the gold price, as ultra-low real yields remain a key support,” Capital Economics economist James O’Rourke wrote in a note.
In other metals, silver soared 6.4% to $21.18 per ounce, after hitting its highest since July 2014 at $21.20.
“We’re seeing both retail and institutional inflows into Exchange Traded Products and that is helping buttress the (silver) price,” said Michael DiRienzo, executive director, Silver Institute.
“The silver price is rising because of its duality as not only a valuable investment but also as an industrial metal ... interest in silver has risen to levels we have not seen in some time.”
Palladium climbed 5% to $2,156.71 per ounce, after hitting a peak since April 21.
Platinum jumped 5.2% to $886.97 per ounce, after rising to its highest since March 10.
Soyabeans slide
CHICAGO: Chicago soyabean futures fell on Tuesday, despite renewed exports to China, after the US Agriculture Department issued better-than-expected weekly crop ratings.
Corn also eased on better-than-expected crop conditions as traders eye record yield potential this fall. Wheat, meanwhile, rose as a weaker US dollar made the crop more competitive on the world export market.
The Chicago Board of Trade’s most active soyabean contract fell 6-1/2 cents to $8.96-1/2 per bushel by 11:42 a.m. (1642 GMT).
CBOT corn was down 5-1/2 cents at $3.22-3/4 a bushel and wheat added 7-1/4 cents to $5.29-1/4 a bushel.
In its weekly crop report after markets closed on Monday, the US Department of Agriculture rated 69% of soyabeans in good-to-excellent condition, up from 68% last week. Analysts had expected 67%.
“This is one of the highest-rated bean crops we’ve had - ever,” said Chuck Shelby, president of Risk Management Commodities.
China booked 126,000 tonnes of US soyabeans for delivery in the 2020/21 marketing year, the USDA said on Tuesday.
“I think we’re really going to need to see some more significant Chinese purchases to push the bean market and stay above $9.00,” said Shelby.
The USDA said 69% of US corn was in good-to-excellent condition, unchanged on the week. Analysts had expected 68%.
“We’re going to have a record corn yield,” said Joe Vaclavik, president of Standard Grain. “Those ideas continue to weigh on the market.”
Wheat gained off a softening US dollar, which makes US exports more attractive to international buyers.
“The weaker dollar has been a positive input for wheat,” said Vaclavik. “Our exports, which have historically accounted for a tremendous portion of our demand, are just not what they need to be.”
The USDA said that 74% of US winter wheat has been harvested, up from 68% last week. Analysts had expected 79%.—Reuters
