© Reuters. Gold bars and coins are displayed at a jewelry store in India, in a photo from Reuters archive.
(Reuters) – It rose on Monday as the dollar weakened and investors awaited imminent US economic data that would provide a clearer picture of the path of interest rate hikes by the Federal Reserve (the US central bank).
And the price increased 0.2 percent to $ 1844.59 an ounce by 1135 GMT, after hitting the lowest level since late December in the previous session. And US gold futures rose 0.2 percent to $ 1853.50.
“We still look forward to higher prices in the coming quarters, but in the near term I think gold prices will continue to be volatile, and US economic data indicates a slowdown in economic activity,” said Giovanni Stonovo, an analyst at UBS.
And last week’s economic data provided indications of the resilience of the US economy and the increase in job opportunities available in the labor market, which raised concerns that the Federal Reserve will maintain high interest rates for a longer period.
Investors are focusing on the January meeting statement of the Federal Open Market Committee and the US GDP data.
Several Federal Reserve officials indicated last week that more interest rate hikes are needed to reduce inflation in pursuit of the central bank’s 2 percent target.
It fell slightly on Monday from its highest level in more than a month hit on Friday, making bullion priced in US dollars more attractive to buyers holding other currencies.
Financial markets now expect the Federal Reserve to raise interest rates to just below 5.3 percent by July.
Gold is considered a hedge against rising inflation, but high interest rates increase the opportunity cost of owning the precious metal, which does not yield a return.
As for other precious metals, the spot price rose 0.1 percent to $21.75 an ounce, and platinum rose 0.6 percent to $922.29, and it increased 0.5 percent to $1,505.44.
Market activity is expected to be relatively limited on Monday due to the President’s Day holiday in the United States.
(Prepared by Ahmed Sobhi and Amira Zahran for the Arabic Bulletin – Edited by Marwa Salam)
