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Bengaluru — Gold prices rose on Tuesday as the dollar slipped, but the metal languished near a 2½-year low on prospects of further rate hikes by the US Federal Reserve to tame soaring inflation.
Spot gold was up 0.4% at $1,628.78 an ounce at 3.15am GMT, after hitting its lowest since April 2020 at $1,620.20 on Monday. US gold futures edged 0.2% higher to $1,636.30.
The dollar index dipped 0.1%, easing off a two-decade peak hit in the previous session. The benchmark 10-year Treasury yield was also slightly off a 12-year peak marked on Monday.
Slightly lower US yields and dollar may have provided some room for gold prices to stabilise after its recent sell-off, said IG market strategist Yeap Jun Rong.
“The prevailing upside risk to inflation and, hence, monetary policy tightening, still remains an obstacle limiting gold’s upside,” he said.
Fed officials on Monday sloughed off rising volatility in global markets and said their priority remained controlling inflation.
Gold prices have declined more than 20% since rising above the $2,000 level in March, as rapid US rate hikes made the non-yielding bullion less attractive and also pushed the dollar to multiyear highs.
“Gold’s status as a haven asset in times of economic distress has failed to stem the flow of selling,” analysts at ANZ said in a note.
Indicative of investor sentiment, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell to 30,333,443 ounces on Monday, its lowest since March 2020.
Spot silver rose 0.6% to $18.45 an ounce, platinum fell 0.2% to $850.46 and palladium inched 0.1% lower to $2,044.99.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Gold firms as dollar softens
Bengaluru — Gold prices rose on Tuesday as the dollar slipped, but the metal languished near a 2½-year low on prospects of further rate hikes by the US Federal Reserve to tame soaring inflation.
Spot gold was up 0.4% at $1,628.78 an ounce at 3.15am GMT, after hitting its lowest since April 2020 at $1,620.20 on Monday. US gold futures edged 0.2% higher to $1,636.30.
The dollar index dipped 0.1%, easing off a two-decade peak hit in the previous session. The benchmark 10-year Treasury yield was also slightly off a 12-year peak marked on Monday.
Slightly lower US yields and dollar may have provided some room for gold prices to stabilise after its recent sell-off, said IG market strategist Yeap Jun Rong.
“The prevailing upside risk to inflation and, hence, monetary policy tightening, still remains an obstacle limiting gold’s upside,” he said.
Fed officials on Monday sloughed off rising volatility in global markets and said their priority remained controlling inflation.
Gold prices have declined more than 20% since rising above the $2,000 level in March, as rapid US rate hikes made the non-yielding bullion less attractive and also pushed the dollar to multiyear highs.
“Gold’s status as a haven asset in times of economic distress has failed to stem the flow of selling,” analysts at ANZ said in a note.
Indicative of investor sentiment, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell to 30,333,443 ounces on Monday, its lowest since March 2020.
Spot silver rose 0.6% to $18.45 an ounce, platinum fell 0.2% to $850.46 and palladium inched 0.1% lower to $2,044.99.
Reuters
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