PRECIOUS-Gold gains on dollar, U.S. bond yield retreat

* U.S. bond yields dip from 14-month highs

* Palladium heads for best week since early Nov. 2020 (New throughout, adds comments, updates prices)

By Brijesh Patel

March 19 (Reuters) – Gold was on track for its second straight weekly gain on Friday as a slight retreat by the dollar and U.S. Treasury yields offered it support.

Spot gold was up 0.3% at $1,740.99 per ounce by 0947 GMT. Bullion is up more than 0.6% so far this week. U.S. GCv1 gained 0.5% to $1,741.60.

“A correction in the US 10-year Treasury yield, and indeed in the is offering a little bit of a lift to gold prices, but we’ve been up here before around the $1,745 level and gold’s found some resistance,” Ross Norman, an independent analyst, said.

“It doesn’t feel like gold got a lot of momentum behind it or sufficient to push it through. We might require a convincing indication that these corrections in yield and the US dollar are more sustainable, and there’s no evidence of that just now.”

The benchmark U.S. 10-year yield eased after climbing more-than-one-year peak of 1.754% on Thursday, while the dollar gave up early gains. USD/ US/

The U.S. Federal Reserve this week repeated its pledge to keep its target interest rate near zero and expected higher economic growth and inflation this year. is often used as a hedge against higher inflation, but a recent spike in U.S. Treasury yields has weighed on the non-yielding commodity.

Palladium dropped 2.8% to $2,608.25 per ounce, after rising as much as 7.3% in the previous session. The auto-catalyst metal was on track for a near 11% weekly jump, its biggest since early November 2020.

“Volatility on the palladium market remains very high. Though the price is trading $100 lower today, the ‘risk’ of another surge in the short term is probably high,” Commerzbank (DE:) analysts wrote in a note. was steady at $26.05 and platinum was down 0.9% at $1,196.69.



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