Gold Prices Stable Amid Iran Pessimism as US Data Provides Support
Recent economic data has provided support for gold prices despite decreased optimism about an Iran deal. The analysts at Heraeus noted that gold prices trended steadily to slightly higher last week, following a strong rally in the prior week.
The analysts attributed this stability to weak jobs data, US CPI and PPI coming in at or lower than estimated, which led to a 20 bp reduction in the US 2-year Treasury yield. As a result, the implied probability of a September rate hike by the Fed decreased from ~80% to ~35%. This shift has been seen as positive for precious metals prices.
Barrick's gold production remains on track to meet its full-year guidance, with attributable gold production reaching 796 koz in Q3. Output was broadly flat year-on-year, but yield from continuing operations increased by 8% due to divested assets in the comparative period.