World Gold Prices Drop For Up To Five Days In A Row

Futures gold illustration (Photo: Doc. Antara)

JAKARTA - The price of gold futures ended in decline at the end of trading Friday, August 11 or Saturday morning, August 12 West Indonesia time (WIB). This decline fell five consecutive days.

When analyzed, this fall after the increase in the US producer price index (IHP) was slightly higher than expected in the midst of a stronger US dollar and increased the yield of government bonds.

Citing Antara, the most active gold contract for December delivery at the Comex New York Exchange Division was cut 2.30 US dollars or 0.12 percent to close at 1,946.60 US dollars per ounce, after touching the highest session at 1,953.60 US dollars and the lowest at 1,942.70 US dollars.

Gold futures eroded 1.70 US dollars or 0.09 percent to 1,948.90 US dollars on Thursday (10/8), after being cut 9.30 dollars or 0.47 percent to 1,950.60 US dollars on Wednesday (9/8), and fell 10.10 US dollars or 0.51 percent to 1,959.90 US dollars on Tuesday (8/8).

The US Department of Manpower reported Friday (11/8) that the US IHP, the inflation measure before reaching consumers, rose 0.3 percent in July months to months and 0.8 percent year-on-year, following a year-to-year increase of 0.2 percent in June, the lowest annual increase since August 2020.

Market analysts argue that the increase in US wholesale prices in July still reflects the overall downward trend in inflation.

Weak prices have fallen this week although reports of US inflation Thursday (10/8) are cooler than expected, due to concerns about potential re-acceleration of inflationary pressures, along with concerns that bond yields and US dollars may continue to rise, have eased demand for precious metals.

The US dollar index, which measures the greenback against six other major currencies, rose 0.3 percent to 102.85. The yield on 10-year US government bonds rose 6 basis points to 4.162 percent from 4.141 percent on Thursday (10/8/2023) afternoon when Fed San Francisco President Mary Daly said the Fed had more work to do to tame inflation even though recent data showed consumer prices rose just 0.2 percent in July.

The initial reading of the University of Michigan's consumer sentiment index fell slightly to 71.2 in the first two weeks of August after hitting a 22-month high at 71.6 in the previous month. Economists expect the index to be at 71.3.

"Gold continues its slow decline to $1,900 per ounce as there are still doubts as to whether the Federal Reserve still has one more interest rate hike in its current cycle, even after yesterday's encouraging US inflation data," Rupert Rowling, a market analyst at Kinesis Money, said in an emailed comments.

Another precious metal, silver for September delivery, fell 7.80 cents, or 0.34 percent, to close at 22.743 US dollars per ounce. Platinum for October delivery slipped 0.20 dollars, or 0.02 percent, to settle at 914.60 dollars an ounce.