In This Article:
Gold prices (GC=F) rose about half a percent on Tuesday, pushing closer to the $2,100 mark, which has proven to be a resistance level for the precious metal. Yahoo Finance's Jared Blikre breaks down what is driving prices higher.
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Video Transcript
JULIE HYMAN: We are seeing markets higher. We're also seeing gold prices rise in today's session. Jared Blikre here with a closer look at what is happening for the yellow metal and elsewhere. Hey, Jared.
JARED BLIKRE: Hey, Julie. Let's take a look at commodities. This is the year-to-date totals. And on the top line, we find gold somewhat in the middle. Interestingly, the softs-- that would be OJ, orange juice, cocoa, feeder cattle, which is not as soft, but also KC, which is coffee-- guess what, those were the top performers of the year. But we want to talk about the barbarous yellow metal.
This is an intraday chart, which actually looks pretty similar to the year-to-date chart. That was intraday to year to date. Here we go. And this right here is not an intraday record high. But I believe it is the highest settlement ever. And gold has been bumping up against the 2,000, 2,100 level for some time.
If you take a look at the last five years, we see a number of attempts here. That's one, two, three. And on the fourth time, finally broke above here. But who's buying gold? Well, a big purchaser of gold this year, as well as previous years, is central banks, particularly China and Russia. This chart goes back to 2010.
And you can see, right now, we are on track this year to be about the total that we did last year. That's about 1,100 tons of gold. And this figure is going to be updated. So it very well could be updated-- or it could be higher than this 2022 total overall.
But there's one thing that's been holding gold back, I think, here. And this has to do with the interest rate structure. So this chart goes all the way back to 2008, the global financial crisis. In purple is the price of gold. And here's that breakout. But you can see, it's been tracking the inverse of US 10-year interest rates for some time. And then starting last year, there's just this huge disconnect.
So while I think it's impressive that gold has been able to climb as far as it has, to really see that movement, we probably need to see yields come down or some other kind of, I guess, metric to kind of fill the void here because this is a rather large gap, guys.
JOSH LIPTON: All right, we'll be watching. Jared, thank you for that.