Commodities News

Gold Down, Tumbles From $2,000 Mark as Dollar Remains Near Two-Year High

By Gina Lee – Gold was down on Tuesday morning in Asia, after hitting the $2,000 mark during the previous session. The dollar was near a two-year high and dented the safe-haven yellow metal’s appeal.

Gold futures were down 0.24% to $1,981.70 by 11:59 PM ET (3:59 AM GMT), after climbing to $1,998.10 on Monday as the war in Ukraine continues and inflation concerns mount. But gold gave up most of Monday’s gains as the dollar and U.S. 10-year Treasury yields firmed.

“That $2,000 per ounce is quite a critical level, and the fact that gold effectively closed flat on the day means there appears to be a slight hesitancy to push immediately higher,” City Index’s senior market analyst Matt Simpson told Reuters.

“Gold has the ability to overcome the U.S. dollar strength and break above $2,000 possibly over the next week or so.”

The dollar, which normally moves inversely to gold, edged up on Tuesday, its highest level since April 2020.

The U.S. Federal Reserve is also likely to hike its interest rate at its next couple of meetings, while yields on the benchmark 10-year U.S. Treasury note eased off recent highs.

“Now that we’ve tested near $2,000, this will be a bit of an eye-opener towards more traditional gold buyers and more momentum type players, with worries over recession in the U.S. also placing gold to go higher in the medium term,” SPI Asset Management managing partner Stephen Innes told Reuters.

In Asia Pacific, the Reserve Bank of Australia released the minutes from its latest meeting earlier in the day.

In other precious metals, silver and palladium inched down 0.1%, while platinum rose 1%.

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