Gold is looking to wrap the month with red candlesticks, pulled down by the Federal Reserve’s decision to keep rates at a steady low.
For the record, the metal recorded a considerable run during the month, ascending near $1,800.00 at one point.
On the other hand, the absence of catalyst that could propel prices further up weighed on its performance in the past weeks.
The spot contract shed off 0.8% to $1,765.96 per ounce, the lowest settlement so far recorded during the week.
The contract recorded a hike to $1,790.00 at one point during the overnight trading but was quick to shelve off some gains.
Meanwhile, gold futures remained steady at $1,766.15, conservatively trading at a contango.
Traders in Asia are currently digesting the juices from consequent manufacturing activity updates from China and Japan.
Both countries reported a hike in their respective manufacturing Purchasing Managers’ Index indicators for April.
On the other hand, the rising costs of raw materials in the international market put manufacturers in a critical position.
Such a condition had driven traders to receive the positive news with apprehension, especially that Covid-19 cases some parts of the region continue to balloon.
In the United States, the Federal Reserve’s continued patronage on near to zero interest rates dismays commodity traders.
The Fed’s chairman, Jerome Powell, noted that fears on inflation must be dismissed despite the increasing commodity prices.
The recent phenomenon is brought by nothing but the natural price cycles in the market and fears of the lack of supply which are not expected to linger for longer.
Now that inflation fears are discounted from the equation, the bullion’s shine begun to fade.
Copper’s on the Upside
In a normal setting, rising prices normally drive traders to safe-haven assets, particularly to the non-yielding yellow metal.
While its counterpart weathers a difficult path towards greener pastures, copper is seemingly unperturbed by challenges.
The industry’s favorite can notch the $10,000.00 per tonne price point for the first time at the London Metal Exchange.
This is the first time that such a scenario came into play, with worries on-demand continuing to play on the upside.
Many analysts are positive that the metal’s bullish momentum will not subside in the near term, and a price target of $10.190.00 is shining more than ever.
Should the commodity manages to hike to that position, this will be its highest recorded so far in the last ten years.