Gold prices traded higher toward a fresh four-month high during Tuesday’s APAC session. Bullion has surged over 13% since early April, underpinned by a weakening US Dollar and growing inflationary pressure. Rising price levels around the globe boosted the appeal of the yellow metal, which is widely perceived as a store of value and hedge against inflation. The DXY US Dollar Index is hovering near a five-month low of 89.78, offering an additional pillar of support to the precious metal.
The strengthening price growth outlook appears to have little impact on real yields however, with the 10-year Treasury inflation-index security staying largely unchanged at -0.85% overnight. The rate has been falling since early April as fears about a “taper tantrum” faded after Fed officials reiterated their dovish stance.
Caledonia Mining Corporation plc (LON:CMCL) is a profitable cash generative gold producer with a strong growth profile, Caledonia’s primary asset is the Blanket Mine in Zimbabwe.