Gold futures were rising slightly on Tuesday, but a rally in global stocks, an advance in Treasury yields and a firming dollar may cap the move for the precious commodity.
February gold
GCG22,
GC00,
was trading $4.50, or 0.3%, higher at $1,784 an ounce, after the yellow metal on Monday lost 0.3%.
Treasury yields across the curve were edging up, with the 10-year Treasury note
TMUBMUSD10Y,
at around 1.45%, while the U.S. dollar was up by less than 0.1% at 96.381, as gauged by the ICE U.S. Dollar Index
DXY,
Richer yields can undercut appetite for non-yielding gold and a stronger greenback can make the dollar-priced commodity more expensive to overseas buyers.
Meanwhile, equities globally were headed higher, diminishing some of the appeal of precious metals, amid hopes that the omicron variant of the coronavirus will prove less damaging to the economy than feared.
Commodity strategists make the case that strong demand for commodities and healthy import and export data out of China may be helping to support buying in gold and other safe-haven assets, despite the factors that would typically serve as headwinds for prices.
“A strong rally in raw commodity sector leader crude oil early this week is supporting upside price action in the metals markets,” wrote Jim Wyckoff, senior analyst at Kitco.com, in a daily note.
March silver
SIH22,
meanwhile, rose 14 cents, or 0.6%, to reach around $22.40, after declining 1% on Monday.
