Gold drops below $1,800 to lowest level in a week as dollar rebounds
METALS STOCKS
Gold has dipped below $1,800 an ounce for the first time in a week amid a broader pullback in commodity prices as the U.S. dollar advanced and traders grappled with a decidedly “risk off” mood in markets.
Price action
- Gold futures expiring in December were down $26.50, or 1.5%, to $1,789 an ounce on Comex, according to FactSet data.
- Silver futures expiring in September lost 48 cents, or 2.3%, to $20.36 per ounce.
- Palladium futures expiring in September were down $47, or 2.1%, to $2,172 per ounce, while platinum futures expiring in October shed $28, or 3%, to $931 per ounce.
- Copper futures dropped 11 cents, or 3.1%, to $3.555 per pound, on track for its biggest daily drop in a month.What analysts are saying
- With equity futures pulling back and Treasury yields falling, markets appeared to be shifting back into “risk off” mode early Monday following a torrid four-week rally for the S&P 500. Analysts blamed the sour mood on weak economic data out of China, along with surprise interest-rate cuts from the country’s central bank.
- Meanwhile, Marc Chandler, chief market strategist at Bannockburn Global Forex, blamed the pullback in gold on the renewed strength in the U.S. dollar. The ICE U.S. Dollar Index, a gauge of the greenback’s strength against a basket of its main rivals, was up 0.6% on Monday after falling to its weakest level in a month late last week.
Craig Erlam, senior market analyst at OANDA, said in a note to clients that it’s too early to tell whether gold’s pullback will continue, or if this is just a slight hiccup on the road higher. But one thing is clear: The $1,800 price level is shaping up to become a key psychological barrier.
In other markets news, bitcoin also tumbled on Monday, trading just north of $24,000, after briefly breaking above $25,000 per coin for the first time since stocks and crypto bottomed in June.