Gold prices rose Wednesday, supported by a decline in the dollar and US bond yields, as investors expect a slower pace of interest rate hikes from the US Federal Reserve at next week’s monetary policy meeting.
Sharjah 24 – Reuters:
Gold prices rose 0.7% in spot transactions Wednesday to $1783.98 an ounce at 14:35 GMT.
US gold futures rose 0.5% to $1,790.60.
Bart Melek, Head of Commodity Markets Strategy at TD Bank, said: Securities “We’re seeing rates down the curve here, there’s a slight decline in the US dollar, we’re just picking up off the lows.”
The dollar fell 0.4% against its rivals, making bullion cheaper for overseas buyers.
And 10-year US Treasury benchmark yields fell to their lowest level in 3 months.
Market participants widely expect the Federal Reserve to raise interest rates by 50 basis points at its last meeting of 2022, scheduled for December 13-14.
Raising interest rates to fight inflation is often intended to increase the opportunity cost of holding gold without interest.
Also awaited is November CPI data from the US, due to be released next week.
However, uncertainty surrounds the future of gold due to strong US economic data recently, which has led to fears that the Federal Reserve may raise interest rates more than recently expected.
“There is now some suspicion that traders may have been too quick to conclude that the US central bank will cut interest rates, and we are now in a bit of a waiting pattern ahead of next Wednesday’s FOMC meeting. Melek said.
Elsewhere, spot silver rose 2.1% to $22.62 an ounce.
“Silver is certainly vulnerable to an economic slowdown due to its industrial appeal, but it could be spared the worst of any downturn given its importance to the energy transition,” Robert Rowling, financial analyst at Kenesy Money, said in a statement. .
Platinum was up 2.3% to $1011.65 an ounce and palladium was up 0.7% to $1862.25.
