Gold prices ended little changed on Tuesday, with an initial currency-backed rally going into reverse in the afternoon session.
Prices briefly rallied as high as $2,200 an ounce on Tuesday, but fell back later in the day to trade at around $2,177 an ounce by late afternoon. That compared with around $2,173 an ounce in late trades on Monday.
Gold’s initial strength was helped by the US dollar, which weakened against other currencies on Monday and Tuesday, supporting dollar-denominated assets like gold. However, the dollar rebounded later, halting gold’s gains and sending prices back down sharply.
The price reversal was further compounded by US durable goods orders figures released Tuesday which showed an increase of 1.4% in February, well above market expectations of a 1.1% gain. The figures pointed to a stronger-than-expected economy, working against expectations that the US Fed will start to cut interest rates in the coming months.
Most stock indices were also in positive territory on Tuesday, adding downward pressure for safe haven assets like gold.
The latest action has left gold prices roughly $45 below last week’s all-time highs of around $2,223 an ounce.
Looking ahead, Wednesday will see Euro Area economic sentiment figures released for March, while the markets will see updated US GDP growth rates for Q4 2023 on Thursday, as well as US initial jobless claims figures for the week ending March 23.
Frank’s experience covering the commodities markets spans 22 years, with a particular specialism in metals, carbon and energy markets. He has worked as a senior editor for S&P Global Commodity Insights (formerly Platts) and before this, at ICIS-LOR, a part of Reed Business Information (Reed Elsevier), where he covered the petrochemicals markets from 2003 to 2005.
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