Gold’s lackluster year is continuing to drive away investors and send the metal’s volatility even lower.
Gains for the dollar, an improving U.S. economy and the outlook for higher U.S. interest rates mean that precious metals have lost their appeal as stores of value. Traders are favoring assets with better yield prospects, such as new bonds and equities, and they’re so bored with gold they’ve driven the 60-day volatility for futures to the lowest since November.
Prices have fallen 0.9 percent this year. Futures settled little changed on Friday, with trading 28 percent lower than the 100-day average for this time, data compiled by Bloomberg show. Higher rates cut gold’s appeal because the metal doesn’t pay interest, unlike competing assets.
“It’s like watching paint dry,” George Gero, vice president of global futures at RBC Capital Markets in New York. “Gold is off the radar. A strong dollar continues to weigh on gold, and the dollar is stronger because of expectations for higher interest rates.”
Gold futures for August delivery rose 0.1 percent to settle at $1,173.20 an ounce at 1:43 p.m. on the Comex in New York. The price dropped in the previous five sessions, and the metal slid 2.4 percent this week, the most since March 6.
Silver futures for September delivery declined 0.5 percent to $15.768 an ounce. Earlier, the price touched $15.48, the lowest for a most-active contract since March 18.
Palladium futures for September delivery fell 0.1 percent to $678.60 an ounce on the New York Mercantile Exchange, after reaching $668.50, the lowest since July 2013. Platinum futures for October delivery declined 0.3 percent to $1,080.70 an ounce.