[SINGAPORE] Gold traded near a seven-month high as investors assessed the outlook for US monetary policy amid swings in financial markets and concern that global growth is slowing.
Bullion for immediate delivery rose 0.2 per cent to US$1,191.90 an ounce at 9.29am in Singapore, according to Bloomberg generic pricing. The metal climbed above US$1,200 an ounce on Monday for the first time since June as global equities slumped.
Gold has outperformed all members of the Bloomberg Commodity Index in 2016 as global growth concerns fueled market turbulence and boosted demand for haven assets. Bullion has also risen as speculation the US central bank will hold off on raising interest rates weakened the dollar. Federal Reserve Chair Janet Yellen appears before the US House Financial Services Committee on Wednesday and will address the Senate Banking Committee the next day.
Volatility on "global markets saw gold remain in sight of the US$1,200 an ounce level," Australia & New Zealand Banking Group Ltd wrote in a note on Wednesday. "Markets will be driven by two things today: the performance of equities and the semi- annual testimony by Fed Chair Yellen."
The odds of a US rate increase by December are now less than 30 per cent, according to data tracked by Bloomberg. Precious metals tend to fare better in a lower rate environment as they don't deliver returns other than through price gains.