Gold prices gain on softer US dollar, Treasury yields
GOLD prices edged higher on Thursday (Dec 21), helped by a softer US dollar and lower Treasury yields as traders looked forward to November US inflation data due out on Friday for more clues on the Federal Reserve’s monetary policy outlook.
Spot gold was up 0.2 per cent at US$2,033.92 per ounce, as at 0106 GMT. US gold futures inched lower to US$2,045.70.
Benchmark US 10-year bond yields fell to an almost five-month month low on Wednesday after British inflation plunged in November to its lowest rate in over two years.
The US dollar was down 0.1 per cent against its rivals, making gold less expensive for other currency holders.
A dovish tilt from the Fed in their last policy meeting has prompted traders to pencil in several rate cuts in 2024, starting as early as March.
However, Fed officials have since been pushing back against the idea of rapid rate cuts next year.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Philadelphia Fed president Patrick Harker said he still opposes any further central bank rate hikes, while signalling openness to lowering short-term borrowing costs, albeit not imminently.
Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
All eyes are now on the November core personal consumption expenditure index report, the Fed’s preferred measure of underlying inflation.
Data on Wednesday showed US existing home sales rose unexpectedly in November. US consumer confidence increased more than expected in December amid optimism about the labour market.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.07 per cent to 878.25 tonnes on Wednesday.
Spot silver rose 0.4 per cent to US$24.20 per ounce, while platinum gained 0.2 per cent to US$960.52 and palladium climbed 0.7 per cent to US$1,204.15. REUTERS
Share with us your feedback on BT's products and services
