Gold’s slight rebound on Friday from a sharp selloff in the previous session lost steam as the dollar gained, putting it on course for a second weekly dip with investors focused on the U.S. Federal Reserve’s tapering strategy.
· Spot gold was down 0.1% at $1,751.29 per ounce by 1:31 pm EDT (1731 GMT).
· U.S. gold futures settled 0.3% lower at $1,751.4.
· A surprise gain in August U.S. retail sales earlier in the week rekindled early Fed tapering fears, boosting the dollar and driving a nearly 3% drop in gold on Thursday.
· The market already believes the Fed will cut back on bond purchases, and that would drive (U.S. Treasury) yields higher, said Daniel Pavilonis, senior market strategist at RJO Futures.
“This does not bode well for gold, it’s most likely going to come back down,” Pavilonis said.
He added the dollar, rather than gold, was benefiting from safe-haven demand from developments in China surrounding property developer Evergrande.
· The dollar climbed to a three-week peak, making gold more expensive for other currency holders, while benchmark Treasury yields also gained.
· “Gold has been a frustrating, mean-reverting product most of the time,” a NY-based trader said, adding that it was likely to be hemmed in the $1,750-80 range going into the Fed meeting.
· The Fed’s policy-setting committee will meet on Tuesday and Wednesday.
· A strong hawkish shift could prompt another knee-jerk, downward reaction in gold even if it has been priced in already, said StoneX analyst Rhona O’Connell.
Unwinding of economic support measures not only dim gold’s status as a safe haven, but any subsequent increase in interest rates would translate to the higher opportunity cost of holding non-yielding assets like bullion.
· Precious metal likely to trade sideways to down in coming week; Fed's decision in focus
· SPDR GOLD HOLDINGS:
NET BUY 1.74 TONNES ON FRIDAY
· Russian gold production dips slightly, silver output grows
Gold production in Russia in January to June decreased by 1.9% compared to the same period last year, amounting to 135.51 tons, the country’s Ministry of Finance said.
The figures are based on raw materials supply data from Russian refineries.
Production of mined gold in the reporting period amounted to 112.61 tons, against 116.38 tons in January to June 2020, while production of by-product gold stood at 7.42 tons against 8.27 tons last year. Production of secondary gold in the first six months of the year increased to 15.48 tons, against 13.45 tons in 2021.
Meanwhile, silver production increased in the reporting period by 1.8%, rising to 445.18 tons, compared with 437.3 tons in 2020.
· Silver slipped 2.4% at $22.37 per ounce, after hitting its lowest level since end-November 2020, putting it on track for its worst week since mid-June.
· Platinum rose 0.5% to $937.67.
· Palladium fell 1.4% to $2,004.46.
· U.S. consumer sentiment steadies in September after August plunge -UMich
U.S. consumer sentiment steadied in early September after plunging the month before to its lowest level in nearly a decade, but consumers continue to have a bleak view of the outlook amid a stiff bout of inflation, a survey showed on Friday.
The University of Michigan said its consumer sentiment index edged up to 71 in the first half of September from 70.3 in August - the lowest since December 2011. Economists polled by Reuters had forecast a reading of 72.
· U.S. Treasury's Yellen: Debt default would 'permanently' weaken America
U.S. Treasury Secretary Janet Yellen issued a fresh plea for Congress to raise the federal debt ceiling on Sunday, arguing a default on U.S. debt would trigger a historic financial crisis.
· Top Senate Democrat Schumer asks U.S. businesses to weigh in on debt default
U.S. Senate Majority Leader Chuck Schumer urged the business community on Tuesday to start weighing in with Republicans on the dangers of not raising the debt ceiling to avoid a government default or partial government shutdown.
· Germany's Laschet says trusts ECB to keep inflation in check
Armin Laschet, the conservative candidate bidding to succeed German Chancellor Angela Merkel in this month's election, said he was confident the European Central Bank (ECB) would achieve price stability, as accelerating inflation hits savers.
The ECB said this month it would trim emergency bond purchases over the coming quarter, marking a first small step towards unwinding the emergency aid that has propped up the euro zone economy during the coronavirus pandemic.
This year, the ECB expects inflation of 2.2%, above its 2% target, before falling to 1.7% in 2022 and 1.5% in 2023.
· China will steadily promote yuan internationalisation in 2021, c.bank says
China will “steadily and prudently” promote yuan internationalisation in 2021, and further develop offshore yuan markets, the central bank said on Saturday.
Cross-border settlements in the local currency totalled 28.39 trillion yuan ($4.39 trillion)in 2020, up 44.3% from the previous year, the People’s Bank of China said in its 2021 yuan internationalisation report.
· France, still mad about that submarine deal, just recalled its ambassadors to the United States and Australia
France’s foreign minister said Friday that the country immediately recalled the ambassadors in protest of a trilateral security deal that included nuclear-powered submarines for Australia.
· UK seeks to break down digital trade barriers, says minister
Britain will look to break down digital trade barriers to help its businesses export their services, the country's newly appointed trade minister Anne-Marie Trevelyan will say on Monday.
· UK set for most widespread pay rises in over a decade - CBI
More British employers are planning pay rises than at any time since the global financial crisis as they struggle to recruit staff following the coronavirus pandemic and Brexit, data from the Confederation of British Industry showed on Monday.
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