Home Business Gold advances on dollar pullback; spotlight on Fed

Gold advances on dollar pullback; spotlight on Fed

3 min read
Comments Off on Gold advances on dollar pullback; spotlight on Fed
0
30


Article content

Gold snapped a four-session slump to rise on Tuesday, propped up by a retreat in the dollar while investors awaited cues on the U.S. Federal Reserve’s monetary policy path.

Spot gold was up 0.5% at $1,746.11 per ounce as of 1307 GMT. U.S. gold futures rose 0.5% to $1,747.40.

Article content

“The U.S. dollar’s stalling rebound is offering spot gold the chance to find a firmer footing around the mid-$1700 region for the time being,” said Han Tan, chief market analyst at Exinity.

Making gold less expensive for overseas buyers, the dollar retreated from strong overnight gains that saw investors flocking to the safe-haven currency on worries over China’s COVID flare ups.

Article content

With ETF investors still missing on the buy side, the dollar’s inverse correlation remains a “key source of directional inspiration” as gold now searches for support in the $1,735 area, Saxo Bank analyst Ole Hansen said in a note.

Investors now await the latest Fed minutes due to be released on Wednesday, with market participants widely expecting a 50-basis point hike in the December meeting, with a peak for rates expected in June.

“The U.S. nonfarm payrolls and inflation prints due before the December Fed meeting are likelier catalysts for bullion’s next big moves,” Tan said.

Interest rate hikes to fight soaring inflation tend to raise the opportunity cost of holding gold, which yields no interest.

Cleveland Fed President Loretta Mester said on Monday the Federal Reserve can downshift to smaller interest rate hike increments from next month.

“Gold bulls were relieved” by Mester’s dovish remarks, Phillip Futures analyst Avtar Sandu said in a note.

Spot silver climbed 1.6% to $21.17 per ounce, platinum added 1.3% to $995.25, and palladium eased 0.1% to $1,864.01.

The World Platinum Investment Council forecast a deficit of the metal in 2023. (Reporting by Kavya Guduru in Bengaluru; Editing by Devika Syamnath)



Source link

Load More Related Articles
Load More By 
Load More In Business
Comments are closed.

Check Also

Rheinmetall moving towards order backlog of 30 billion euros – CEO

Article content DUESSELDORF — German arms maker Rheinmetall had a record year in 2022 and …