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Bengaluru — Gold prices edged up on Tuesday, en route to their third straight month of gains, as the dollar weakened, while market participants awaited the US Federal Reserve policy decision later this week amid hopes of a less aggressive rate hike.
Spot gold rose 0.2% to $1,925.39 an ounce at 2.57am GMT and was headed for a monthly gain of more than 5%. US gold futures were up 0.1% at $1,940.30.
The dollar index was down 0.1% and was set for a fourth straight monthly drop. A weaker greenback tends to make dollar-priced bullion an attractive bet.
Traders mostly expect the Fed to scale back rate hikes to 25 basis points at its two-day policy meeting that ends on Wednesday. The US central bank slowed its tightening pace to 50 basis points in December after four straight 75-basis point hikes.
“The market is trading in a narrow range ahead of the Fed meet. The gold market has already priced in a 25-basis points hike, if the Fed strikes a dovish tone, then it will be positive for gold,” Ajay Kedia, director at Kedia Commodities, Mumbai, said.
A low interest rate environment decreases the opportunity cost of holding non-yielding bullion.
Top gold consumer China’s economic activity swung back to growth in January, official data showed, after a wave of Covid-19 infections passed through the country faster than expected after the dismantling of its pandemic controls.
“With the Chinese economy recovering, physical gold demand in China will improve. Also, there will be support for other precious metals, which are industrial in nature,” Kedia said.
Elsewhere, spot silver rose 0.4% to $23.67 an ounce, platinum gained 0.1% at $1,009.76, and palladium inched up 0.4% to $1,635.48. But all three metals were headed for a monthly decline.
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 inches up and heads for third monthly gain
Bengaluru — Gold prices edged up on Tuesday, en route to their third straight month of gains, as the dollar weakened, while market participants awaited the US Federal Reserve policy decision later this week amid hopes of a less aggressive rate hike.
Spot gold rose 0.2% to $1,925.39 an ounce at 2.57am GMT and was headed for a monthly gain of more than 5%. US gold futures were up 0.1% at $1,940.30.
The dollar index was down 0.1% and was set for a fourth straight monthly drop. A weaker greenback tends to make dollar-priced bullion an attractive bet.
Traders mostly expect the Fed to scale back rate hikes to 25 basis points at its two-day policy meeting that ends on Wednesday. The US central bank slowed its tightening pace to 50 basis points in December after four straight 75-basis point hikes.
“The market is trading in a narrow range ahead of the Fed meet. The gold market has already priced in a 25-basis points hike, if the Fed strikes a dovish tone, then it will be positive for gold,” Ajay Kedia, director at Kedia Commodities, Mumbai, said.
A low interest rate environment decreases the opportunity cost of holding non-yielding bullion.
Top gold consumer China’s economic activity swung back to growth in January, official data showed, after a wave of Covid-19 infections passed through the country faster than expected after the dismantling of its pandemic controls.
“With the Chinese economy recovering, physical gold demand in China will improve. Also, there will be support for other precious metals, which are industrial in nature,” Kedia said.
Elsewhere, spot silver rose 0.4% to $23.67 an ounce, platinum gained 0.1% at $1,009.76, and palladium inched up 0.4% to $1,635.48. But all three metals were headed for a monthly decline.
Reuters
Rand on a slippery slope as energy crisis shows no signs of abating
Asian stocks slip as cautious investors await rates decisions
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