Yen Rally Fades, Gold Slips
Gold prices fell toward US$4,050 per troy ounce during Friday's trading (July 31) as the yen's rally began to lose momentum. This shift helped the US dollar rebound, halting a five-day losing streak.
Spot gold weakened by approximately 1.3% to US$4,051.29 per troy ounce. Despite this correction, the precious metal remains on track for a modest gain in July, marking its first monthly rise since February.
The dollar strengthened again after the Bank of Japan maintained interest rates and Governor Kazuo Ueda offered no fresh support for the yen. The Japanese government has also yet to confirm the suspected intervention that had previously caused the yen to surge as much as 3.3% against the dollar.
A stronger dollar makes gold more expensive for buyers using other currencies. However, buying on dips has helped gold hold above the psychological US$4,000 level in recent weeks.
Markets are now looking for clues regarding the Federal Reserve's next move. Some Fed officials believe interest rates may need to rise if inflation remains high, particularly after a surge in energy prices—driven by the conflict involving the US and Iran—increased price pressures.
Newsmaker Analysis: Gold remains at risk of downward pressure as the dollar and US bond yields strengthen. The US$4,000 level serves as key support, while the US$4,080–US$4,100 range acts as immediate resistance. Middle East tensions could sustain demand for safe-haven assets, though rising oil prices also have the potential to reinforce expectations of higher interest rates. (arl)
Source: Newsmaker.id
