Commodity Blog

Gold prices are having a terrible trading week. Ahead of Federal Reserve Chair Janet Yellen‘s Congressional testimony, the yellow metal continued its freefall on Wednesday.

December gold futures declined $7.70, or 0.58%, $1,322.70 per ounce at 16:50 GMT. Gold has posted losses for four consecutive trading sessions. Despite advancing about 3% last week, it has pared those gains since Monday.

Silver is not doing any better. December silver futures tumbled $0.07, or 0.37%, to $19.09 an ounce. Silver has also been on a losing streak ever since climbing above the closely watched $20 an ounce threshold.

The precious metals have still had a good year overall. Gold has risen 23%, while silver has spiked 40%.

Investors will pay close attention to Yellen’s semi-annual testimony before a Congressional committee on Wednesday. The US central bank head will talk about the national economy, monetary policy, global growth concerns, and an array of other topics. Traders will also comb through speeches made by Cleveland Fed President Loretta Mester and Kansas City Fed President Esther George.

A lot of financial experts will look for clues pertaining to a potential December increase to interest rates. With a September rate hike delay, the market expects rates to go up at the end of the year. In a rising-rate environment, gold’s allure diminishes because it does not offer holders any yield.

Many expect gold bugs to hone in on the informal talks held in Algiers between members of the Organization of the Petroleum Exporting Countries (OPEC). The oil nations are finishing off their two-day meeting regarding production freezes. The yellow metal is viewed as a hedge against oil-led inflation.

The market is in anticipation of Friday’s September inflation reading and of Wednesday’s jobs report.

The US dollar further strengthened on Wednesday. This makes gold more expensive for foreign buyers.

If you have any questions and comments on the commodities today, use the form below to reply.