Gold Price Rises 0.25 Percent Amid U.S. Government Bond Results Drop

JAKARTA - Gold futures prices rose at the end of trading Wednesday, May 31 (Thursday morning WIB), extending profits for the third day in a row amid a decline in yields from US government bonds.

The decline in returns was due to the market awaiting further signal about the increase in the US debt ceiling.

The most active gold contract for August delivery in the Comex New York Exchange division, raised 5 US dollars, or 0.25 percent, to close at 1,982.10 US dollars per ounce, after touching the highest level of the session at 1,993.10 US dollars and the lowest at 1,971.80 US dollars.

Gold futures rose 14.00 US dollars or 0.71 percent to 1,977.10 US dollars on Tuesday (30/5) after being boosted by 60 cents or 0.03 percent to 1,944.30 US dollars on Friday (26/5), and slumped by 20.90 US dollars or 1.06 percent to 1,943.70 US dollars on Thursday (25/5).

The Comex Exchange closed on Monday (29/5) for the Memorial Day holiday. Gold posted a monthly drop of 1.8 percent in May.

Much US economic data will be released this week, with non-farm payroll data (NFP) in May to be released on Friday (2/6), much of which will be a factor in the Federal Reserve's plans for further interest rates.

The dollar withdrew from a 10-week high amid profit taking and data anticipation. However, The Fed's increasingly hawkish outlook makes the greenback relatively supported, while the prospects for non-coupled assets such as gold become gloomy.

However, gold may see an increase in safe haven demand in the event of a US default, which is likely to trigger a recession. US lawmakers will vote this week to pass a bipartisan bill to raise the debt ceiling and prevent an economic crisis.

Meanwhile, some Republican and Democratic lawmakers have signaled dissatisfaction with the bill, and plan to vote against it in Congress.

Economic data released on Wednesday (31/5/2023) are diverse. MNI indicators reported that the Chicago Business Barometer, also known as the Chicago PMI (Buying Manager Index), fell 8.2 points to 40.4 in May, staying below the threshold of 50 indicating a contraction area for 9 consecutive months. Economists expect a 47.3 readout.

The US Department of Manpower reported that US employers posted 10.1 million job vacancies in April, up from 9.7 million in March and the largest since January.

Another precious metal, silver for delivery in July rose 34.80 cents, or 1.50 percent, to close at 23,587 dollars an ounce. Platinum for delivery in July, slumped 22.90 dollars, or 2.24 percent, to settle at 999 dollars an ounce.