Gold set for best year in three as Fed rate cut bets boost appeal
GOLD prices were set on Friday for their best year in three on strong bets of US interest rate cuts early next year and as the war in Ukraine and tensions in the Middle East lifted safe-haven demand.
Spot gold was up 0.2 per cent at US$2,068.95 per ounce, as of 0233 GMT. It has risen 14 per cent so far in the year, heading for its biggest annual gain since 2020.
US gold futures fell 0.2 per cent to US$2,078.70 per ounce.
Bets for interest rate cuts from the US Federal Reserve have firmed following cooler inflation data, with traders now pricing in an 88 per cent chance of monetary policy easing in March, according to the CME FedWatch tool.
Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
The dollar index fell 0.1 per cent on Friday and was poised for its worst yearly performance in three years, boosting gold‘s appeal for other currency holders.
Data on Thursday showed China’s net gold imports via Hong Kong rose about 37 per cent in November from the previous month, as the world’s top consumer eased some import restrictions on the metal to meet expected demand for the Chinese New Year.
Spot silver rose 0.2 per cent to US$23.83 per ounce, but looked set to the end the year largely flat.
Platinum was steady at US$1,002.50 per ounce, a near six-month high, while palladium rose 0.1 per cent to US$1,133.73. Both autocatalytic metals were on track for a yearly decline, with palladium down 37 per cent - its biggest since 2008. REUTERS
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