Gold closed the second month on the rise after June, when gold quotations declined over 7%. However, the asset is below its last year's August records.
According to the last summer month results, the yellow metal showed a slight positive trend. The cost of bullions increased by less than $1 compared to July.
By the end of August gold was trading at $1,818.10. Yesterday it gained $5.90, or 0.3%, while on Monday it lost 0.4% as the dollar struggled to consolidate from a 2-week low.
On Tuesday, the asset gained support by weak US economic data. They showed US consumer confidence fell to a six-month low of 113.8 last month, while the revised reading was 125.1 in July.
The Chicago Business Activity Index dropped again in August. The index decreased from 73.4 in July to 66.8, its lowest level in two months.
Analysts attribute these bad results to the rise of COVID-19 cases worldwide. Concerns about active spread of new coronavirus variants with a fairly high level of immunity to vaccines are exerting intense pressure on many countries' economies, including the US one.
The dollar index fell as a reaction to negative statistics. In yesterday's trading the US currency lost 0.03% against its rivals and dropped to 92.403.
Notably, the dollar followed a downward trend last Friday after Jerome Powell's speech at Jackson Hole Economic Policy Symposium. The US Federal Reserve System head did not set the exact date for the start of bond purchases tampering, which investors interpreted as a "dovish" signal.
At the same time, markets expect more details from the US regulator on the future of its monetary policy. There is an opinion that the Fed may announce the beginning of its asset purchase tapering as early as in September and will launch the process in October. However, later dates with a shift of 1 month are also likely.
Jim Wyckoff, analyst at Kitco expressed his opinion that in case the dollar followed a down trend in the near future, it would give support to gold quotations, as well as the stock market instability. He added that September and October are historically turbulent months for the market.
At this stage, a slowdown in the US economic recovery as a result of the delta variant of Covid-19 spread may hamper the greenback rise. For this reason, investors now focus their attention on Friday's US jobs report.
If the data prove to be weaker than expected, the greenback will definitely fall. Otherwise, there will be speculations about the urge to begin asset purchase tapering and interest rates reduction. It may result in the dollar's rise. In this case, gold will likely be a rank outsider.
On Wednesday, the yellow metal is weak, anticipating the US Labor Department report. The asset value is changing little amid uncertainty about the US economic recovery and the Fed's future course.
In the morning, gold bars were trading at $1,816.8. They fell by $1.3, or 0.07% from the previous close.
Meanwhile, silver dropped a little more, 0.44% to $23.9, whereas the previous session quotes ended little changed.
As for monthly results, unlike gold, August turned out to be unfortunate for silver and other popular metals. Thus, the grey asset lost 6%. Copper fell by 2.4%, which was the worst monthly performance since the beginning of the year. Platinum was down by 3.3% and palladium by 7%, which was also the metal's worst monthly result since January.
The material has been provided by InstaForex Company - www.instaforex.com