Gold gains on lower yields, traders await Powell’s remarks

GOLD prices edged higher in early Asian hours on Thursday (Nov 9), helped by a dip in US Treasury yields, while investors looked forward to comments from US Federal Reserve chair Jerome Powell for more clues on interest rates.

Spot gold was up 0.2 per cent at US$1,953.74 per ounce by 0128 GMT after hitting its lowest since Oct 19 on Wednesday. US gold futures edged 0.1 per cent higher to US$1,959.10.

Benchmark 10-year US Treasury yields held near their lowest in more than a month. Lower bond yields reduce the opportunity cost of holding non-interest bearing gold.

Meanwhile, the US dollar index held steady against its rivals after three sessions of gains.

Powell did not comment on monetary policy or the economic outlook in prepared remarks at a US central bank statistics conference on Wednesday. He is scheduled to speak at another conference on Thursday.

A slew of Fed officials who spoke this week maintained a balanced tone on the central bank’s next decision but noted they would focus on more economic data and the impact of higher long-term bond yields.

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Futures point to a roughly 14 per cent chance of another hike by January, but are pricing in an 18 per cent chance that rate cuts could come as early as March, according to the CME FedWatch Tool.

Lower interest rates boost the appeal of zero-yield bullion.

The European Central Bank (ECB) needs to see further progress in dampening inflationary pressures, and companies along with governments need to chip in to prevent more policy tightening, ECB policymakers said.

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Gold prices flat as investors await US Fed chair Powell’s speech

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.03 per cent to 867.28 tonnes on Wednesday.

Spot silver fell 0.4 per cent to US$22.61 per ounce, while platinum gained 0.3 per cent to US$868.82. Palladium eased 0.3 per cent to US$1,047.16, hovering near its lowest level since 2018. REUTERS