Gold holds firm near record high as markets eye Fed policy signals
[BENGALURU] Gold held firm near a record high on Monday (Sep 22) as investors awaited US inflation data and a slew of Federal Reserve speakers this week for additional policy cues after the central bank lowered interest rates last week and signalled potential further easing.
Spot gold edged up 0.1 per cent to US$3,689.08 per ounce by 8.44 am. Bullion hit a record high of US$3,707.40 on Wednesday.
US gold futures for December delivery climbed 0.5 per cent to US$3,724.50.
Market focus has shifted to the release of the US core Personal Consumption Expenditure price index, the central bank’s preferred inflation gauge. The data is due on Friday.
The Fed cut rates by 25 basis points last week, signalling potential future easing while cautioning about persistent inflation.
At least a dozen Fed officials are scheduled to speak this week, including chair Jerome Powell on Tuesday, as markets look for further insights into the central bank’s monetary policy outlook.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
New Fed governor Stephen Miran on Friday defended himself as an independent policymaker after dissenting in favour of steep rate cuts at Wednesday’s policy meeting and adding that he hopes to convince his fellow policymakers to support larger cuts in future meetings.
Investors are broadly expecting two additional rate cuts this year, 25 bps each in October and December, with probabilities of 93 per cent and 81 per cent, respectively, according to the CME FedWatch tool.
Bullion has gained more than 40 per cent this year, driven by broader geopolitical and economic uncertainty, central bank buying, and monetary policy easing.
Safe-haven bullion, which offers no yield, typically performs well in a low-interest-rate environment.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 1.94 per cent to 994.56 tonnes on Friday from 975.66 tonnes on Thursday.
Spot silver rose 0.1 per cent to US$43.12 per ounce, hovering near a 14-year high. Platinum eased 0.3 per cent to US$1,399.69 and palladium rose 0.4 per cent to US$1,154.17. REUTERS
Share with us your feedback on BT's products and services
