Gold ekes out gains as dollar rally takes a breather
GOLD prices edged higher on Tuesday (Aug 23) after hitting a near 1-month low in the previous session, helped by a slight pullback in the dollar although lingering worries over further aggressive US interest rate hikes kept gains in check.
Spot gold was up 0.2 per cent at US$1,738.90 per ounce, as of 1.28 am GMT, after hitting its lowest since Jul 27 at US$1,727.01 on Monday.
US gold futures gained 0.2 per cent to US$1,751.70.
The dollar eased 0.1 per cent against its rivals after hitting a more than 1-month high overnight, making gold less expensive for buyers holding other currencies.
US central bank officials have “a lot of time still” before they need to decide how large an interest rate increase to approve at their Sep 20-21 policy meeting, Richmond Federal Reserve president Thomas Barkin said last week.
Recent hawkish comments from Fed officials have dented bullion’s safe-haven appeal. Focus now turns to the Fed’s Jackson Hole, Wyoming, symposium due later this week.
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Fed funds futures are now pricing in a 56.5 per cent chance of a 75-basis-point rate hike by the Fed in September.
The European Central Bank must keep raising interest rates even if a recession in Germany is increasingly likely, as inflation will stay uncomfortably high all through 2023, Bundesbank President Joachim Nagel said over the weekend.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.15 per cent to 987.56 tonnes on Monday from 989.01 tonnes on Friday.
Zijin Mining is restarting normal production at its Colombia gold mine, a spokesperson said on Monday after people from the surrounding community ended more than a week of road blockades.
Spot silver gained 0.2 per cent to US$19.04 per ounce, platinum rose 0.3 per cent to US$877.70, and palladium climbed 1.5 per cent to US$2,023.10. REUTERS
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