Dollar near one-month high hit in previous session

27/09/2017 10:17 AST

Gold was largely unchanged on Wednesday after falling over one percent in the previous session on hawkish comments from U.S. Federal Reserve Chair Janet Yellen, while lingering North Korea worries supported prices.

Spot gold inched 0.1 percent higher to $1,294.89 per ounce at 0425 GMT. In the previous session, prices fell 1.3 percent in what was the biggest loss in over two weeks.

U.S. gold futures for December delivery fell 0.3 percent to $1,297.80 per ounce.

"Gold lost what it gained on North Korea (tensions) since Friday after Yellen's comments, said Yuichi Ikemizu, Tokyo branch manager at ICBC Standard Bank.

"But I think the (North Korea) situation is more serious than the Fed's policies. So, gold is supported around here and I expect prices to go back up to $1,300 an ounce."

On Tuesday, Yellen said the Fed needs to continue gradual rate hikes despite broad uncertainty about the path of inflation - remarks that acknowledged the central bank's struggles to forecast one of its key policy objectives.

Gold is highly sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the greenback.

A strong U.S. inflation reading could raise expectations for future interest rate increases. President Donald Trump warned North Korea on Tuesday that any U.S. military option would be "devastating" for Pyongyang, but said the use of force was not Washington's first option to deal with the country's ballistic and nuclear weapons program.

"The wild card, as usual, is the North Korea situation, something that is very hard to quantify at this stage," INTL FCStone analyst Edward Meir said in a note Geopolitical risks can boost demand for safe haven assets such as gold.

The dollar climbed to a one-month high and bond yields rose as risks grew for a U.S. interest rate hike in December, while Asian stocks hovered near multi-week lows as tensions in the Korean peninsula remain elevated.

The biggest focus for the market for Wednesday is the announcement of a tax plan by the U.S. administration and Republicans in Congress.

Among other precious metals, silver rose 0.3 percent to $16.82 per ounce. In the previous session, prices fell 2.4 percent, their biggest fall since mid-August Platinum gained 0.2 percent to $923.50 per ounce, after slipping about 2 percent in the previous session, its biggest decline since early July.

Meanwhile, palladium fell 0.1 percent to $913.40 per ounce.


Reuters

Ticker Price Volume
SAVOLA 31.25 412,710
(In US Dollar) Change Change(%)
Gold 1,193.1 -18.1 -1.49
Silver 14.97 -0.31 -2.03
Platinum 802 -24 -2.91
Palladium 888 -16 -1.77
Gold edges back from record peak as firm US data dims shine

05/08/2020

Gold was little changed on Tuesday, hovering below the previous session's record peak as fears over the pace of economic recovery amid surging coronavirus cases were offset by upbeat U.S. manufacturi

The Gulf Today

Sudan further opens gold trade to private sector

18/06/2020

Sudan, a gold producer, has taken steps to open up the trade in the precious metal further to private investors, allowing them to handle all exports and taking the business out of state hands, the Su

Arab News

Investors ask ‘why do I need gold’ amid rate hikes, stock rally

14/08/2018

Hedge funds have never been this pessimistic about gold. Money managers are making their biggest-ever bet that prices will decline. That comes on the heels of five straight weeks of losses for bullio

Gulf News

Gold gains as weaker dollar, lower price levels induce buying

08/08/2018

Gold prices climbed on Tuesday, supported by a weaker US dollar and buying after a recent price slump. Spot gold was up 0.4 per cent at $1,210.99 (Dh4,447.96) an ounce at 0814 GMT, after earlier hitt

Gulf News

Global gold sales shine less bright in 2018

02/08/2018

At 1,959.9 tonnes, worldwide demand for gold has slipped to its weakest first-half performance since 2009, with the dip jewellery sales in India and the Middle East being one of the reasons. In the U

Gulf News