Gold rebounds above $2,000 from a 2-month low last week. The macro-environment was not looking great for precious metals after the US CPI report was released last Tuesday showing a higher-than-expected consumer price index of 3.1%. Friday also released a hot PPI report and both of these factors combined caused the US dollar to hold a rally last week and greatly strengthened the US dollar. Gold and the US dollar tend to move in the opposite direction so when the US dollar strengthened, it took the spot price of precious metals down to $1,990 with its rally. 

Gold is currently recovering its loss from last week and the upward trajectory is fuelled by the weakening of the US dollar this week and geopolitical tensions in the Middle East. The dollar index was down 0.1% which makes bullion more affordable for investors overseas. In addition, a UK-registered cargo ship was under attack in the Bab al-Mandab Strait off Yemen this Sunday and worldwide tensions raise the appeal of gold as a safe-haven investment in the eyes of global investors. The Chinese market also opened up and resumed trading after the week-long Lunar New Year holidays, which fuelled the recovery of gold. 

Currently gold is up 0.10% from last week while silver is down 1.25$ from last week’s high of $23.5 down to $23.20. Platinum, which sees its demand from industrial uses in auto-catalysts rose by 1.7% and its sister metal palladium also saw its spot price rise by 2.5% since last week.