Economic news

Gold Steady as Weaker U.S. Yields Counter Firmer Dollar

  • Japan's Nov retail sales rise faster than expected
  • Palladium touches one-month high
  • Asian stock markets generally weaker

Dec 27 (Reuters) - Gold held steady on Monday above the key level of $1,800 per ounce, as slightly weaker U.S. Treasury yields countered an uptick in the dollar.

Spot gold rose 0.1% to $1,809.95 per ounce by 0323 GMT, staying mostly ahead of $1,800 since closing above that level for the first time in a month last week.

U.S. gold futures were little changed at $1,811.40.

Benchmark U.S. Treasury yields edged down from their highest in more than a week touched in the previous session, reducing the opportunity cost of holding bullion, which pays no interest.

The dollar index inched up from its weakest level in nearly a week, making greenback-priced gold less attractive for holders of non-U.S. currencies.

"Gold faces resistance just above $1,815 and if the recent past is any indication, gold will continue to struggle to hold onto gains at these levels unless the U.S. dollar moves sharply lower this week," said Jeffrey Halley, a senior market analyst at OANDA.

"Liquidity is very thin this week, so the smallest of flows will cause intraday noise."

Asian stock markets were generally weaker with U.S. crude in holiday-thinned trading, as uncertainty over the economic impact of the Omicron variant weighed on investor sentiment.

Japan's retail sales rose faster than expected in November as fewer COVID-19 cases encouraged shoppers to ramp up spending on goods and services. 

Spot silver dropped 0.8% to $22.76 an ounce, and platinum fell 0.9% to $965.45.

Palladium was up 0.6% at $1,960.38 an ounce, after hitting its highest since Nov. 23 at $1,962.50 earlier in the session.

Reporting by Bharat Govind Gautam and Seher Dareen in Bengaluru; Editing by Richard Chang and Vinay Dwivedi

Source: Reuters

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