World gold prices maintained their recovery momentum in the session of September 18, as US bond yields cooled down and oil prices fell, helping to reduce pressure on precious metals, while the market continued to assess policy signals from the Fed.
As of 9:30 am on September 18 Vietnam time, spot gold prices increased by 0.25% to 4,352.63 USD/ounce. Meanwhile, December gold futures fell 0.14% to 4,393.47 USD/ounce.
Gold prices are maintaining an increase after a strong recovery in the previous session. This precious metal increased by nearly 2% on September 17, thereby offsetting most of the decline in the previous three sessions.
The recovery took place after US Treasury bond yields fell across many terms. The sharp increase in yields after the Fed's decision put pressure on gold, as precious metals do not pay interest and are often less attractive when bond yields rise.
In addition, oil prices continued to fall for the third consecutive session, contributing to cooling concerns about energy cost pressure. Oil supply is expected to gradually stabilize, thereby reducing pressure from energy prices on inflation.
The gold market also continued to react to the decision of the US Federal Reserve (Fed). The US central bank increased interest rates by 0.25 percentage points on September 16 and signaled the possibility of further interest rate hikes. This is still a factor putting pressure on gold prices in the short term.
However, the recovery of gold after the interest rate decision shows that part of the selling positions may be being adjusted. The increase on September 17 brought gold prices back above the 100-day moving average – an indicator often tracked to assess market momentum.
However, the signal of policy tightening from the Fed is still a drag on the precious metal. High interest rates increase the attractiveness of profitable assets, thereby reducing the relative advantage of gold.
On the precious metals market, spot silver prices rose 0.94% to 65.81 USD/ounce. Platinum prices rose 0.91% to 1,788.62 USD/ounce, while palladium prices rose 1.55% to 1,303.45 USD/ounce at 9:30 am on September 18. According to Bloomberg, silver prices rose 0.4% to 65.51 USD/ounce at 8:12 am in Singapore.
