Gold Eases After Rising to the Highest Levels in Over a Week

Gold prices are sliding lower early on Thursday on the back of a weak inflation report from the US; however, losses remain limited due to

Arslan Butt•Thursday, February 11, 2021•1 min read

Gold Eases After Rising to the Highest Levels in Over a Week

Gold prices are sliding lower early on Thursday on the back of a weak inflation report from the US; however, losses remain limited due to a weakness in the US dollar and in US Treasury yields. At the time of writing, GOLD is trading at a little above $1,836.

During the previous session, gold had climbed to an over one-week high after the inflation report from the US revealed a slight increase in consumer prices. An improvement in fuel prices was offset by a decline in airfares in the wake of the coronavirus pandemic, raising concerns about economic recovery and keeping inflation far below the Fed’s 2% target.

While prices have eased lower since then, gold is enjoying support from the US dollar that fell to a two-week low even as US Treasury yields also fell. The precious metal is considered a hedge against inflation and its safe haven appeal receives a boost whenever Treasury yields decline.

Gold also finds support from an improvement in physical demand across India – the world’s second largest consumer of the precious metal. According to government data, the safe haven metal’s imports rose by 72% YoY during January when consumers and jewelers rushed to make the most of the fall in prices.

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ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.