Gold Prices See Strongest Daily Rise in Two Weeks
The precious metal recorded its strongest performance in over two weeks with a 1.6% increase on Thursday.
Gold gained 1.6% on Thursday to post its strongest daily performance in over two weeks and maintained its gains despite a limited pullback on Friday morning.
Current Market Situation and Prices
The 1.6% rise in the gold market on Thursday marked the strongest daily performance in over two weeks. Although a limited pullback occurred on Friday morning, the vast majority of the previous session's gains were retained, with spot gold trading around $4,160. This movement also compensated for the losses incurred following Wednesday's U.S. inflation data.
Sell-Off in Equities
At the center of the movement in global markets were deepening concerns regarding growth in artificial intelligence investments. These worries triggered exits from chipmaker stocks in particular on Wall Street and led to an intense sell-off wave in equities.
Impact of Bond Yields
Investors looking to reduce risk in stocks turned to the bond market in search of a safe haven, leading to an increase in global bonds. U.S. Treasury yields saw significant declines ranging from 12 to 15 basis points across various maturities.
Support Provided to Gold
For gold, which does not generate interest income, the level of bond yields is of great importance. The drop in yields reduced the cost of holding gold compared to interest-bearing assets, providing strong support to the precious metal and triggering Thursday's rally.