World gold prices continued to maintain their upward momentum in the trading session on August 26, as investors assessed the impact of falling US government bond yields and falling oil prices. The precious metal remained close to the 3-month high set in the previous session.
As of 9:39 am Vietnam time, spot gold prices increased by 0.54%, to 4.663.39 USD/ounce. Meanwhile, December gold futures contracts increased by 0.57%, to 4,721.21 USD/ounce.
This upward momentum extended the 5-session upward streak of gold. In the past week, precious metal prices have increased by more than 7%, significantly supported after the US Treasury Department boosted long-term government bond repurchases.
Gold is often seen as one of the assets benefiting from this trend due to its limited supply and not directly dependent on the solvency of a government.
US government bond yields fell by about 5-7 basis points across the entire yield curve in the August 25 session, creating more support for gold. Because gold does not generate fixed income, falling bond yields will reduce the opportunity cost of holding precious metals.
Investors are currently focused on Fed Chairman Kevin Warsh's speech at the Jackson Hole seminar on August 28. This is one of his first important speeches as Fed Chairman and may provide more signals about the direction of US monetary policy in the coming time.
On the precious metals market, spot silver price on the morning of August 26 increased by 1.49%, to 69.62 USD/ounce. Platinum price increased by 1.07%, to 1,881.82 USD/ounce, while palladium increased by 1.31%, to 1,353.75 USD/ounce.
The fact that gold prices continue to maintain above 4,600 USD/ounce after increasing by more than 7% in a week shows that buying power is still strong. However, the rapid increase also increases the possibility of profit-taking sessions appearing. In the coming sessions, PCE data and messages from Fed Chairman Kevin Warsh at Jackson Hole will be important factors for the diễn biến of gold prices.
