Gold Rises to a Record as the Dollar Weakens Even as U.S. Retail Sales Surged in March
Gold surged to a record high early on Wednesday as the dollar fell despite unexpectedly strong U.S. retail sales in March, ahead of U.S. President Donald Trump's April 2 imposition of blanket tariffs on imports.
Gold for June delivery was last seen up US$103.30 to US$3,343.700, topping the April 11 record close of US$3,244.60 per ounce.
The rise comes as the U.S. Census Bureau reported March retail sales rose by 1.4% from the prior month, up from a rise of 0.22% in February and ahead of the FactSet consensus estimate for a rise of 1.3%. Sales excluding autos rose 0.5% month over month, up from 0.7% in February and ahead of the 0.3% consensus estimate.
The strong sales data offered little support to the U.S. dollar, which has fallen to two-year lows on worries Trump's trade wars are upsetting global trade flows and likely to raise inflation and slow growth. The ICE dollar index was last seen down 0.81 points to 99.4.
It is "clear that gold's strong performance has to a great extent been driven by USD weakness, most notably against the three current go-to currencies of EUR, JPY, and CHF, leading to more modest gains for investors in those regions and countries", Ole Hansen, head of commodity strategy at Saxo Bank noted.
Treasury yields were also lower ahead of an afternoon speech by Federal Reserve Chair Jerome Powell to the Economic Club of Chicago. The U.S. two-year note was last seen paying 3.82%, down 4.4 basis points, while the yield on the 10-year note was down 2.8 points to 4.311%.
Source: MT newswires
