The ounce of gold fell Thursday to its lowest for a month at 1,688.93 dollars.
Gold suffers from the appreciation of the dollar, because the greenback is the reference currency of the gold market and its rise makes the yellow metal more expensive for investors using other currencies.
Given the message from the head of the US Federal Reserve (Fed), Jerome Powellat the end of the previous week, “its determination to bring down inflation via a firmer monetary policy” will weigh on gold, warn analysts at UBS.
In the wake of gold, other precious metals are suffering: silver and platinum sank Thursday to their lowest since the summer of 2020 at $17.56 and $821.28 an ounce, respectively.
In the case of platinum, “basically, there are signals that real demand is there, but it doesn’t show in the price”told AFP Nicky Shielsfrom precious metals broker MKS PAMP.
The 25% drop in platinum in six months is explained by its correlation to gold, but because the market for platinum is much smaller and less liquid than that for gold, the movements there are amplified.
Moreover, the main platinum producer in the world is South Africa, whose currency has plunged against the dollar, making its exports less expensive.
On the other hand, demand is increasing, particularly for the automotive industry, which uses platinum for its catalysts. “The chip shortage, which has hampered vehicle production, is easing,” pointed out Nicky Shiels.
According to her, platinum could therefore rebound… Provided that it does not remain dragged down in the wake of gold.
An ounce of gold traded for 1,717.72 dollars on Friday around 3:00 p.m. GMT (5:00 p.m. in Paris), against 1,738.14 dollars seven days earlier at the end of the session.
The ounce of platinum cost 845.79 dollars, against 866.97 dollars a week earlier.
Aluminum at the end of the line
Industrial metals trading on the London Metal Exchange (LME) were also weighed down over the week by a healthy dollar and the prospect of tighter monetary policy.
“In addition, concerns about growth have been fueled by the fight against Covid-19 which continues in China with long confinements” which weigh on the activity of the world’s leading importer of metals, notes Ole Hansen, analyst at Saxo Bank. Aluminum saw its price plunge to $2,288 on Thursday, its lowest since March 2021.
However, in the longer term, this metal could benefit from the production limitations that could be caused by the energy crisis throughout the world, as aluminum smelters are particularly power-hungry.
“The latest information from China’s Yunnan region shows that supply could be reduced, with water reserve levels at 50% of their usual level”, while many aluminum factories in the region use electricity from hydraulic dams, note analysts from Commerzbank.
The ton of aluminum traded for 2,318.50 dollars on the LME, against 2,493.50 dollars seven days earlier at the close.