How Precious Metals Are Moving Versus the US Dollar
Reaction of precious metals
Among the four precious metals, gold (GLD) traded almost flat on Tuesday, September 19, after retreating for two days. Gold has lost almost 1.7% over the last five trading days. Gold futures for October expiration fell by a marginal 0.02% after touching the day’s low of $1,304.9 and closed at $1,306.7 per ounce.
Silver rebounded from the previous day’s slump and rose 0.72% to end at $17.3 per ounce. Platinum and palladium lost strength and fell 1% and 3.1%, respectively, on the same day. Palladium had been maintaining strength over the past few days, but Tuesday, September 19, wasn’t lucky. It saw a close at a one-month low of $905.4 per ounce.
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The crucial factor playing on precious metals over the past few days is the rise of the US dollar. Though the US dollar eased on Tuesday against the major world currencies, it continued hovering near an eight-week high against the Japanese yen.
The fluctuations in the US dollar are often important in determining changes in precious metals. They’re all dollar-denominated assets. The higher dollar (UUP) deters investors from other countries.
The dollar’s gains weren’t only harmful to precious metals but also to mining stocks like Hecla Mining (HL), Kinross Gold (KGC), Barrick Gold (ABX), and Cia De Minas Buenaventura (BVN). These four miners have fallen 1.5%, 4.2%, 3%, and 2.3%, respectively, on a five-day trailing basis.