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Gold Prices Settle Higher; Silver Prices also Edge Higher

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Gold prices logged gains for yet another session on Monday as the U.S. dollar weakened a tad following the release of unexpectedly weak retail sales data, making dollar-priced commodities cheaper for holders of other currencies. Silver prices also edged higher in trading on Monday.

U.S. gold futures for August delivery gained $6, or 0.5%, to settle at $1,283.60 an ounce while spot gold was almost flat at $1,283.79. In late trading, the SPDR Gold Trust (ETF) (NYSE: GLD) was down 0.18% to $123.91.

Silver futures were last up 0.27% to $19.85 an ounce.

Gold futures posted its best weekly performance, gaining more than 5% last week after the Federal Reserve Chairman surprised market participants by saying that the bank will continue with its accommodating monetary policy for a foreseeable future.

The remarks prompted investors to take fresh positions on inflation-hedge bets even as the dollar came under pressure.

However, analysts expects the recent spark in the bullion market will be short lived as the Fed is very likely to start scaling down its bond purchase program by the end of this year or early next year. Some say that the Bernanke’s dovish comments were only to ensure that there’s enough liquidity in the market and to calm down investors’ nerves.

Now, the entire spotlight will on Bernanke’s testimony to the Congress on July 17 and 18.

In a note to clients, Danske Bank analyst, Christin Tuxen wrote, “The main focus is Bernanke’s testimony to the Congress, and that should really give us more guidance to whether tapering will start in September or December,” according to Reuters.

 








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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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