Commodities News – Gold Rebounds Slightly
Gold prices rebounded in Asia on Wednesday as investors saw recent declines on a stasis in tensions on the Korean peninsula as a chance to buy and on physical demand as the Indian festival season approaches.
Gold futures for December delivery on the Comex division of the New York Mercantile Exchange rose 0.33% to $1,337.04 a troy ounce. India and China vie for the title of the world’s top gold buyers and importers.
Overnight, gold prices fell below break-even on Tuesday as easing U.S.-North Korea tensions fueled demand for riskier assets lifting global stocks to record highs for a second straight day.
The relief rally continued for a second straight day, lowering demand for safe-haven gold as investors shrugged off fresh threats from North Korea after the United Nations imposed a fresh round of sanctions, restricting the country’s access to oil imports while limiting textile exports.
North Korea’s ambassador to the UN, Han Tae Song, told a conference in Geneva: “The forthcoming measures by DPRK [the Democratic Republic of Korea] will make the US suffer the greatest pain it has ever experienced in its history.”
Also weighing on gold prices was a sharp rise in U.S. treasury yields ahead of inflation data due Wednesday, which could influence the Federal Reserve’s interest rate decision slated for September 20.
Gold is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.
Analysts, however, have been quick to downplay gold’s poor start to the week as data pointing to a surge in buying activity suggests that demand for the yellow metal remains supported.
Net bullish bets on gold rose to 245,300, the highest in nearly twelve-months, according to a report from the Commodity Futures Trading Commission (CFTC) on Friday.
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