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Gold Trying to Rebound from Worst Weekly Performance This Year

February 26, 2018 at 18:20 by Andrew Moran

Gold futures are trying to rebound from last week’s biggest weekly decline this year. The yellow metal is looking to rally to start the trading week and ahead of Federal Reserve Chair Jerome Powell’s testimony to Congress this week for the first time.

April gold futures rose $3.00, or 0.23%, to $1,333.30 per ounce at 17:00 GMT on Monday. Last week, gold prices suffered a 1.8% weekly drop, the biggest weekly loss in 2018 and the worst since December.

Silver, the sister white metal, is also posting modest gains to kick off the week of trading. May silver futures advanced $0.086, or 0.52%, to $16.57 an ounce.

Metal commodities found support in new data that showed US home sales tumbled by 7.8% in January, the second month in a row of decreasing sales. On Thursday, important inflation data will be released.

Gold prices are further benefiting from a weaker US dollar as the greenback slipped 0.09%. Treasury yields also slid on Monday with the benchmark 10-year note falling 0.35% to 2.87%. A lower buck is good for dollar-denominated commodities because it makes it cheaper for foreign investors to buy.

Last week, the Fed’s semi-annual monetary-policy report was released, which offered a positive view of the US economy but warned of pending inflation later this year.

The rise of precious metals comes as the head of the US central bank is scheduled to deliver prepared testimony on Capitol Hill on Tuesday, followed by an appearance before the House Financial Services Committee. On Thursday, Powell will accept questions from the Senate Banking Committee.

Investors do expect the Fed to raise interest rates three times in 2018, but they will be combing through his remarks to determine if the central bank will pull the trigger on a fourth rate hike this year.

Other metals are trading higher. April palladium futures climbed $13.75, or 1.32%, to $1,054.15 an ounce. April platinum futures jumped $3.20, or 0.32%, to $1,002.00 an ounce. March copper futures tumbled $0.0155, or 0.48%, to $3.197 per pound.

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