Gold rose slightly on Friday, approaching a two-week low in the previous session after the head of the World Health Organization (WHO) said the Omicron variant could not be considered ” soft,” while stronger yields capped bullion’s gains.
* Spot gold XAU= was up 0.2% at $1,791.73 an ounce at 0100 GMT. US gold futures GCv1 rose 0.1% to $1,791.70.
* The precious metal was poised for its worst weekly fall since late November, down around 2%.
* The more infectious Omicron variant of COVID-19 appears to produce less severe disease than the globally dominant Delta strain, but it should not be classified as “mild”, World Health Organization officials said Thursday. health (WHO). (Full story)
* Alarmed by the persistence of uncomfortably high inflation, even the most dovish US central bankers now agree that they will have to tighten policy this year. (Full story)
* Traders are currently pricing in more than a 70% chance of a rate hike of at least 25 basis points at the Fed’s March meeting, according to the CME FedWatch Tool.
* Benchmark 10-year US Treasury yields hit their highest level since March 2021, while 10-year TIPS yields hit their highest level since June 2021. Higher yields raise the cost of desirability of holding gold. WE/
* Gold is considered a hedge against higher inflation, but the metal is very sensitive to rising US interest rates which increases the opportunity cost of holding non-performing bullion.
* Spot silver XAG= was flat at $22.16 an ounce, platinum XPT= rose 0.2% to $966.85 and palladium XPD= rose 0.1% to 1 $875.78.
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