rose gold pricesYields on the dollar and US Treasuries eased on Thursday as traders await fresh indications on the Federal Reserve’s (US Central Bank) plans to raise interest rates.
Gold in spot transactions rose 0.2% to $1807.57 an ounce, after declining 1% in the previous session, while U.S. gold futures fell 0.1% to $1814.3, according to Reuters.
The dollar index fell 0.2%, as a weaker dollar makes bullion more attractive to buyers holding other currencies.
Benchmark US Treasury yields have fallen for ten years, after hitting a six-week high in the previous session.
Traders will be watching the weekly US jobless claims numbers released at 13:30 GMT for their potential impact on the Federal Reserve’s rate-hiking strategy.
Ajay Kedia, director of Kedia Commodities in Mumbai, said: “Unemployment data will matter if it shows rising claims (for the benefit), should weaken the dollar and support gold.”
Bullion is on track for an annual decline of about 1%, under pressure from sharp hikes in US interest rates.
Still, prices rose nearly $200 from a more than two-year low in September on hopes that the US central bank will slow the pace of interest rate hikes.
The Fed slowed that pace to 50 basis points in December, following four consecutive hikes of 75 basis points each, while Fed Chairman Jerome Powell stressed the need to keep interest rates high for some time to combat the ‘inflation.
High interest rates weaken gold’s appeal as an inflation hedge and increase the opportunity cost of owning the yellow metal because it does not produce a return.
In terms of other precious metals, the spot price of silver rose 0.2% to $23.57.
Platinum rose 0.3% to $1,010.67, while palladium rose 0.2% to $1,786.97.
