Fresh All-Time High

Gold is steady in the Asia-Pac session, after hitting a fresh all-time high of $2482.42.

• Bullion closed 1.9% higher at $2469.08 on Tuesday, as traders placed stronger bets on Federal Reserve rate cuts this year and weighed an uncertain outlook for US politics.
• Lower rates are typically positive for gold, which doesn’t pay interest.
• US Treasuries finished near session bests on Tuesday with the long-end out-performing. The US 10-year yield finished 7bps lower at 4.16% versus a 4bp drop for the US 2-year to 4.42%. The early session sell-off following stronger-than-expected US Retail Sales data was completely reversed.
• Retail sales printed flat (-0.02% unrounded) growth m/m, slower than the +0.3% registered in May (upward rev from 0.1%), but above the -0.3% expected. Sales ex-autos (+0.4% vs 0.1% expected) and ex-auto/gas (+0.8% vs +0.2% expected) beat and with higher revisions.
• Gold has rallied by over 50% since late 2022, underpinned by demand from central banks, to diversify reserves and reduce their reliance on the US dollar.
• According to MNI’s technicals team, the breach of the bull trigger suggests technical conditions remain firmly in bullish territory.