Gold prices retreated slightly from a more than one-week peak on Tuesday as some investors opted for the dollar instead as surging COVID-19 Delta variant cases posed a threat to a global economic recovery.
· Spot gold fell 0.2% to $1,784.02 per ounce by 1:59 p.m. EDT (1759 GMT) after hitting its highest since Aug. 6 at $1,795.25.
· U.S. gold futures settled 0.1% lower at 1,787.80 per ounce.
· SPDR GOLD HOLDINGS: Drop for third straight day!
· “U.S. Treasury yields are giving gold a little bit of cover, and we’re seeing a higher probability of inflation without rising interest rates,” Pavilonis said.
The dollar index jumped 0.5%, also benefiting some safe haven interest as disappointing U.S. retail sales data, rising COVID-19 infections worldwide and turmoil in Afghanistan dented appetite for riskier assets such as equities.
· Gold often competes with the dollar as a safe store of value during political and financial uncertainties, with a higher dollar also making gold more expensive for those holding other currencies.
· The market’s focus now turns to minutes from the Federal Reserve’s July meeting due on Wednesday for cues on the U.S. central bank’s stimulus tapering.
· “We believe it likely that oncoming asset purchase reductions are already factored into the gold price - but the pace of those reductions is still quite uncertain,” HSBC analyst James Steel said in a note.
“Afghan events do not usually move gold, but the swift and apparently complete Taliban victory may indirectly support ‘safe haven’ assets such as bullion, even if only modestly. ... The impact on gold may be greater than at first imagined,” Steel added in the note.
· Elsewhere, silver fell 0.9% to $23.60 per ounce, after having hit its highest since Aug. 9 at $23.95.
· Platinum shed 3.1% to $990.38 per ounce.
· Palladium slid 4.6% to $2,485.55 per ounce,after earlier slipping to a near two-month low of $2,481.52.
· Retail sales drop worse-than-expected 1.1% in July as rising Covid fears hit consumers
· U.S. homebuilder confidence falls to 13-month low in August
· Fed's Powell: Not certain Delta outbreak will dent recovery
It remains unclear whether the heightened outbreak of the coronavirus Delta variant will have a noticeable impact on the economy, U.S. Federal Reserve Chair Jerome Powell said Tuesday.
· Fed's Kashkari: 'Reasonable' to taper late this year or early next
Minneapolis Federal Reserve President Neel Kashkari on Tuesday said that it could be “reasonable” to start reducing the Fed’s bond-buying program later this year, though it would depend on making further progress in the labor market.
· Analysis: As investors look to Jackson Hole, options markets see 'a lot of nothing'
Traders in U.S. equity options do not expect the Federal Reserve’s symposium in Jackson Hole, Wyoming later this month to spark big moves in stocks, even as a focus on the Fed’s taper timeline amplifies the buzz around the annual event, data and interviews with market participants showed.
Investors typically place bets, or hedges, that would protect their portfolios around events that could generate market volatility.
· Euro zone growth confirmed at 2% in Q2, employment rises
The euro zone economy grew 2% in the second quarter, the European Union statistics office said on Tuesday, confirming its earlier reading as the easing of coronavirus restrictions spurred economic activity after a brief recession.
The healthy 2% increase in gross domestic product (GDP) compared to the previous quarter was paired with a 13.6% rise from the same period last year, when the euro zone economy suffered the worst phase of the pandemic.
The annual GDP reading was slightly revised downward from Eurostat’s earlier estimate of 13.7% growth, released at the end of July.
The GDP growth fuelled a rise in employment in April-June, with the indicator increasing 0.5% on the quarter and 1.8% on the year. The annual growth was above forecasts of a 1.5% rebound after a series of falls.
· Iran accelerates enrichment of uranium to near weapons-grade, IAEA says
Iran has accelerated its enrichment of uranium to near weapons-grade, the U.N. atomic watchdog said in a report on Tuesday seen by Reuters, a move raising tensions with the West as both sides seek to resume talks on reviving Tehran's nuclear deal.
Iran increased the purity to which it is refining uranium to 60% fissile purity from 20% in April in response to an explosion and power cut at its Natanz site that damaged output at the main underground enrichment plant there.
Iran has blamed the attack on Israel. Weapons-grade is around 90% purity.
· NATO blames the ‘failure of Afghan leadership’ for Taliban’s swift takeover
· Taliban, striking dovish tone, pledge peace and women's rights under Islam
The Taliban said on Tuesday they wanted peaceful relations with other countries and would respect the rights of women within the framework of Islamic law, as they held their first official news briefing since their lightning seizure of Kabul.
· China may align itself with Taliban and try to exploit Afghanistan’s rare earth metals, analyst warns
· Biden's vow to airlift Afghan allies meets ticking clock, risky rescue
· Biden approval drops to lowest of 7-month presidency after Taliban takeover
President Joe Biden's approval rating dropped by 7 percentage points and hit its lowest level so far as the U.S.-backed Afghan government collapsed over the weekend in an upheaval that sent thousands of civilians and Afghan military allies fleeing for their safety, according to a Reuters/Ipsos poll.
· Biden, UK's Johnson discuss Afghanistan, agree to hold G7 meeting
· UK says will work to avoid humanitarian disaster in Afghanistan
· UK plans to welcome thousands of Afghans in new refugee plan
· Turkey welcomes Taliban statements since their takeover in Afghanistan
· UK aims to start trade talks with India this year
· Stocks and oil slide as Delta's spread muddies economic picture
Major stock indexes slid and oil posted its fourth straight day of declines as investors grappled with mixed economic data and considered the economic impact of the ongoing spread of the Delta coronavirus variant.
Wall Street closed down sharply on Tuesday, with the most significant declines seen in mega-cap technology-related and consumer discretionary stocks as investors scaled down their risk appetite.
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· U.S. will extend COVID-19 transport mask mandate through Jan. 18
· Texas governor tests positive for COVID-19; Houston offers vaccine incentive
· New Zealanders begin life in lockdown, Delta cases edge up
· UK regulator approves Moderna COVID-19 shot for 12 to 17-year-olds
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