On Monday, gold prices rose and there was a partial fall in government bond yields and the US dollar, increasing the appeal of precious commodities.
But the yellow metal may also have taken on additional interest after public filings that Warren Buffett’s Berkshire Hathaway Inc. Offers holdings of BRK.A.
It was revealed that the group had taken a new stake in Barrick Gold Corporation BLK, the world’s second largest gold mine, in the previous quarter.
Gold came under pressure last week, as the US Treasury climbed to an eight-high high, detracting from the appeal of bullion. However, gold enthusiasts insist that the uncertainty about the economic scenario stemming from the COVID-19 pandemic makes the bullion a solid long-term bet, especially when countries spend trillions to support their economies.
On Monday, Treasury yields were slipping, with a 10-year Treasury note rate TMUBMUSD10Y,
0.69% and a US dollar gauge against half a dozen currencies, ICE US Dollar Index DXY,
From 0.1%. Low yields of gold benefit because it does not offer a coupon and a weaker dollar may make bullion more attractive to users of other currencies.
Some experts view the stretch from a recent powerful uptrend of gold and silver as consolidation ahead of its next phase. Gold suffered a sharp surge on Tuesday that helped draw the weekly win streak.
In a note, ActivTrades Chief Analyst Carlo Alberto de Casa wrote, “We will signal a new rapid with a clear transit of $ 1,965 in a scenario affected by coronovirus news and fears of further lockdowns.” Expectations for further action by central banks still exist and this is another contributory element to gold. A recent decline below the support area of $ 1,920- $ 1,930 reflects weakness. ”
Indeed, the People’s Bank of China injected fresh liquidity into its financial system on Monday, while it held steady at a $ 2.95% rate on a one-year medium-term lending facility, as it relates to the effects of the viral outbreak, Reuters reported.
December Gold GCZ20,
Exposed last Tuesday to the largest daily dollar decline since April 15, 2013, the metal was followed up by $ 14.10, or 0.7%, to $ 1.963.90 an ounce on Friday, a weekly decline of about 3.9%.
Meanwhile, September silver prices SIU20,
94 cents, or 3.6%, to $ 27.030 per ounce after a 5.3% weekly loss.