Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Gold reversed course and climbed back above the $1,900/oz level on Friday, as the precious metal was boosted by a pullback in the dollar.
Spot gold gained 0.8% to $1,910.26/oz by 11:00 a.m. ET, having dropped to a two-month low earlier this week. US gold futures were up by 1.2%, trading at $1,915.30/oz on the Comex.
[Click here for an interactive chart of gold prices]
“The dollar strengthening early in the week was a major driver for the gold weakness, and as we’ve seen the dollar reverse … that is clearly lending some support to gold,” Saxo Bank analyst Ole Hansen told Reuters, adding that bullion is also seeing fresh momentum from a technical buying perspective.
Also lifting the safe-haven metal’s appeal, data showed the US economy unexpectedly contracted in the first quarter amid a resurgence in covid-19 cases and drop in pandemic relief from the government.
The dollar index slipped 0.6% after touching a 20-year high on Thursday, making gold cheaper for holders of other currencies.
Still, bullion is headed for a monthly drop with aggressive interest rate hikes by the US Federal Reserve looming.
Markets focus is now on the US central bank’s two-day policy meeting next week, when officials are expected to increase the target policy rate by half a percentage point.
Fed officials have aligned around plans to accelerate the pace of interest rate hikes this year, but remain split over what could be the make-or-break decision of where to stop to avoid dragging the economy into recession.
