A weaker US dollar also worked in the yellow metal’s favor, with investors looking to hedge against currency debasement and inflation. The other precious metals also benefited from the rally and were sitting in the green on Friday (October 9) morning.
The broader base metals sector performed positively too, and edged higher throughout the week.
After a brief dip to US$1,876.50 per ounce, gold was on track for a second consecutive week of gains. Renewed optimism that a US stimulus deal could be reached in the coming weeks pushed it higher.
“Should spot gold be able to notch a higher high past the US$1,920 resistance level, that should confirm its recent uptrend over the past fortnight and assure its grip on the US$1,900 handle for the near future, provided dollar doesn’t throw a wrench into the works,” FXTM market analyst Han Tan told Reuters.
Gold exchange-traded funds also continue to grow at a record-setting pace. They added US$60 billion (1,000 tonnes) worth of gold to their holdings from January to September, as per the World Gold Council.
At 10:44 a.m. EDT on Friday, an ounce of gold was valued at US$1,926.80.
Silver also climbed higher this session, starting the period at US$23.95 per ounce and moving as high as US$24.70 on Friday morning.
Having added as much as 37 percent to its January start price of US$18.02, silver is keeping pace with its sister metal, and according to many analysts it is bound to outperform the yellow metal.
“(Silver) has already outperformed gold by about 6 percentage points,” Maria Smirnova, senior portfolio manager at Sprott Asset Management, told the Investing News Network.
“It is more volatile than gold, it’s a much smaller market, so I think the price moves (are) more amplified both on the up and the down. In bull markets, which I think we’re in, silver does outperform gold historically,” she explained.
Smirnova went on to point out that gold is purely a monetary asset, while silver has “two heads to it —one is the monetary investment head and the other side is the industrial demand side.”
Silver was priced at US$24.70 at 10:57 a.m. EDT on Friday.
Platinum made a modest uptick mid-week, but was subsequently pushed lower later on. Despite starting the period at US$881 per ounce, the metal edged as high as US$893 before shedding those gains.
By the end of the week, platinum was back in territory seen on Monday (October 5). At 11:01 a.m. EDT on Friday, platinum was trading for US$880.
Palladium registered the largest gain this week, climbing from US$2,250 per ounce on Monday to a six month high of US$2,384. The 5.9 percent uptick marks one of the metal’s best weekly performances since January.
Since the start of the year, palladium has risen more than 18 percent, but is still well off its year-to-date high of US$2,614, seen in February. At 11:09 a.m. EDT on Friday, palladium was selling for US$2,368.
As mentioned, the base metals were able to edge higher this week, with nickel making the most significant gains.
Starting the session at US$14,360 per tonne, the metal added 2.2 percent to its value to sit at US$14,687. The value increase was attributed to the return of Chinese business and deals following a week-long national holiday. Nickel was holding in the US$14,687 range on Friday.
Copper ended the five day session in the green. The red metal surged higher mid-week, going from US$6,509 per tonne on Tuesday (October 6) to US$6,611.50 by Thursday (October 8).
Since hitting a year-to-date high in September, copper has shed some of it gains. Despite the losses, it still remains well above its year-to-date low of US$4,617.50, seen on March 23. Copper was selling for US$6,611.50 on Friday.
Zinc was able to pull out a modest gain for the week, edging from US$2,298 per tonne to US$2,356.
Despite the broad gains benefiting the sector, analysts are awaiting some clarity when a report from the Chinese congress is released later this month.
“While the metals are suffering from what appears to be a bout of short-term euphoria, let us not forget the major congress in China at the end of this month that will see the laying out of the long-term plan for a non-US export-based economy,” Malcolm Freeman, director of Kingdom Futures, told Metal Bulletin.
He added that it could have more bearing on the industry than the US election. Zinc was priced at US$3,356 on Friday.
Lead ended the week slightly higher, reversing three weeks of losses. While the metal squeaked out a small gain, it is still well short of the US$2,000 per tonne value it attained earlier in the year. Lead ended the week at US$1,779.