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Metals Stocks: Gold prices kick off 2023 by settling at highest since mid-June

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Gold prices kicked off the first trading session of 2023 on Tuesday by advancing to fresh 6-month highs, bolstered by lower bond yields and expectations about more central-bank buying.

Other precious metals were trading at notable levels, including silver, which saw the most-active contract touch its highest level since April, while platinum reach its highest intraday level since March.

Price action

Gold prices due in February
GC00,
+1.00%

 
GCG23,
+1.00%

advanced $15, or 0.8%, to $1,841.20 per ounce on Comex after touching a high at $1,856.60. Prices for the most-active contract haven’t traded at levels this high since mid-June, FactSet data show.

March silver
SI00,
+0.67%

 
SIH23,
+0.67%

climbed 21 cents, or 0.9%, to $24.25 per ounce after an intraday high at $24.775, the highest for a most-active contract since mid-April.

April platinum
PLJ23,
+0.88%

advanced $10.40, or 1%, to $1,093.30 per ounce following a high at $1,108.70, the highest for a most-active contract since the first half of March. The precious metal recorded its strongest quarterly advance since 2008 in the three months ended Dec. 31.

March palladium
PAH23,
-5.62%

dropped $78.50, or 4.4%, to $1,719.50 per ounce.

March copper
HGH23,
-1.17%

lost 3.6 cents, or 0.9%, to $3.7745 per pound.

Market drivers

Gold and silver prices touched their highest intraday levels in months with the outlook for precious metals improving markedly recently, analysts said.

Prices continued to advance despite a stronger U.S. dollar as traders focused instead on lower Treasury yields, while purchases by the People’s Bank of China has inspired hope among traders that some central banks might increase the share of their reserves allocated to gold.

“Central bank purchases might be another factor, following reports last month that the People’s Bank of China has started to increase its gold reserves,” said Marios Hadjikyriacos, senior investment analyst at XM.

The ICE U.S. Dollar Index
DXY,
+1.11%

rose 1.1% to 104.608, while the 10-year yield
TMUBMUSD10Y,
3.785%

dropped 9.5 basis points to 3.783%.

The gains for gold and silver are “surprising” given strength in the dollar, said Edward Meir, founder of Commodity Research Group, in commentary written for Marex. “We think something will have to give in the unusual dollar/gold move and suspect it will be the dollar that will decline first, as opposed to gold selling off. given that the U.S. Treasury market is not all that dollar-friendly” in Tuesday trading.  

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