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Gold is back above 1500 as the yield curve reverses on bonds

2019-08-14 11:59 am | Resource: News | No Views : 46

 الذهب يعود  إلى ما فوق 1500 دولار مع انعكاس منحنى العائد على السندات

The interest rate and recession caused stocks to fall on both sides of the Atlantic on Wednesday as investors rushed to preserve value by buying assets thought to be less risky. German, UK and US government bonds benefited the most while gold and silver jumped, reversing earlier declines as risk appetite eased yesterday. Market participants initially shouted the convergence between the administration in Washington and China when a trade war truce was agreed.

Swinging towards easing policy bias in major central banks is putting pressure on sovereign yields and interest rates in general. This helped push the US yield curve into a two-to-ten-year reversal, and the same happened to British securities. Low borrowing costs affect banks and the financial sector, which extends to other sectors and the entire economy. The yen and the Swiss franc also rose.

Dow drops 200 points before bell recession fears

Wall Street stocks fell on Wednesday after data from Germany and China showed a drop in GDP and industrial production, respectively, while growth in the euro zone slowed with industrial production falling 1.6% in July. At the same time, the yield curve of two to ten years on US Treasuries has flipped briefly.

Yesterday, stocks rose after Washington announced it was delaying or eliminating tariffs on some Chinese products due to be implemented from Sept. 1.
  • At 12:21 CET, the Dow Jones Industrial Average fell 216 points, or 0.82%.
  • The Nasdaq 100 fell 1.06%.
  • The S&P 500 fell 0.83% at the same time.
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The euro rose 0.13% against the dollar at 12:22 CET, trading at 1.11848 dollars.

Precious Metals Trading
  • Gold rose 0.43% to $ 1507.92 an ounce at 12:50 CET, and returned above the psychological level of $ 1,500.
  • Silver jumped 0.99% to $ 17.13 an ounce.
  • Platinum and palladium, a precious metal mostly used in the automotive industry, lost 0.49% to $ 851.06
  • Palladium fell 0.76% to $ 1.445.72 an ounce.


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