Precious metals prices extended their move higher on Thursday, erasing more of their decline from earlier in the week and heading back toward a near-term high reached last month.
The move comes as Treasury yields
TMUBMUSD10Y,
and the dollar
DXY,
retreated, making precious metals more attractive by comparison.
Here’s what’s moving in metals markets
-
Front-month gold
GC00,
+0.74%
futures were up 0.5% to trade at $1,858 per troy ounce; the yellow metal is now up 1.6% on the year. -
Silver
SI00,
+1.00%
was up 1% to $22.15 per ounce; it remained down more than 5% so far for the year. -
Platinum
PL00,
+1.01%
built upon its sizable gains from yesterday’s session, trading 1.5% higher to $1,011, crossing back above the psychologically important $1,000-per-ounce level. -
Palladium
PA00,
+0.40%
was up 0.4% to $2,010 per ounce.
Citi’s Aakash Doshi, a precious metals analyst, recently cut his near-term price target for gold, arguing that a confluence of factors are conspiring to keep a lid on the precious metal’s price.
“A hawkish Fed, higher real rates, and what still remain anchored medium-term inflation expectations (in both surveys and bond market pricing) have weighed on gold price momentum amid a relatively robust [U.S. dollar] backdrop. It also seems likely some geopolitical risk premium has eroded as the market absorbed the Russia/Ukraine conflict,” Doshi wrote in a note to clients.
Elsewhere, a team of analysts at Commerzbank explained why platinum prices have outperformed recently, citing expectations of increased demand from the automobile industry as a supply-chain crunch fades.
“Platinum is likely to profit from the increased demand from the automotive industry that is expected this year by market observers like Johnson Matthey and Metals Focus,” wrote Commerzbank’s Daniel Briesemann
It’s worth noting that platinum has risen on each of the last five days of trading, gaining around $50 and driving the price discount versus gold to just $850 per troy ounce, its narrowest level since March.
The outlook for industrial metals was more mixed, as prices of aluminum fell and copper climbed after a popular gauge of U.S. manufacturing activity – the S&P Global U.S. manufacturing PMI – showed activity slowing in May to a four-month low.
Here’s how industrial metals were trading
- Aluminum traded on the London Metals Exchange was down 4% to roughly $2,700 per metric ton.
- Copper climbed 3% to $4.47 per pound.
