Gold ticks lower as lofty dollar dulls appeal

Gold edged lower on Monday, as the dollar steadied near a 20-year peak, continuing to weigh on demand for greenback-priced bullion. FUNDAMENTALS Spot gold was down 0.1% to $1,740.16 per ounce at 0045 GMT. U.S. gold futures dipped 0.2% to $1,739.50. The dollar held near its highest level in about 20 years, keeping overseas buyers away from gold.

Gold fell for a fourth straight week on Friday, hurt by the dollar’s ascent and bets for steep interest rate hikes gaining traction after healthy U.S. jobs data. Atlanta Federal Reserve Bank President Raphael Bostic, until recently among the central bank’s most dovish policymakers, on Friday said he “fully” supports another three quarters of a percentage point interest rate rise at the Fed’s next policy meeting later this month. Benchmark U.S. 10-year Treasury yields steadied near an over one-week high hit on Friday, weighing on gold. After a miserable first half for the stock market, investors are assessing whether the U.S. economy can avoid a significant downturn as the Fed raises rates to fight the worst inflation in decades.

Gold is seen as a hedge against inflation, and a safe-haven asset during economic crises, like a recession. However, higher interest rates and bond yields increase the opportunity cost of holding non-yielding bullion. SPDR Gold Trust , the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.11% to 1023.27 tonnes on Friday from 1024.43 tonnes on Thursday.

Asian shares started cautiously on Monday as investors braced for a U.S. inflation report that could force another super-sized hike in interest rates. Spot silver fell 0.2% to $19.27 per ounce, and platinum slipped 1% to $887.89. Palladium dipped 1.3% to $2,153.50, after rising nearly 10% on Friday.

Source link

Recent Posts

Scan to Download
ios&Android APP

Open trading account and start trading!

Join our happy customers