Gold ticks higher as weaker US dollar, yields lend support

GOLD prices edged higher on Thursday, hovering close to a key US$2,000 per ounce level, as an overall weaker dollar and lower US Treasury yields buoyed demand for bullion.

Spot gold was up 0.1 per cent at US$1,992.59 per ounce, as of 0143 GMT, after hitting a three-week high of US$2,007.29 on Tuesday.

US gold futures were steady at US$1,993.30.

The dollar was down 0.1 per cent against its rivals after gains in the last two sessions and making gold less expensive for other currency holders.

The benchmark US 10-year Treasury yields fell to a two-month low on Tuesday.

Data showed orders for long-lasting US manufactured goods fell a more-than-expected 5.4 per cent in October, signaling an economy cooling considerably after hot third-quarter growth.

The number of Americans filing new claims for unemployment benefits fell more than expected last week, but that likely does not change the view that the labour market is slowing amid higher interest rates.

US Federal Reserve officials agreed at their last policy meeting that they would proceed “carefully” and only raise interest rates if progress in controlling inflation faltered, the minutes of the Oct 31-Nov 1 gathering showed on Tuesday.

Traders widely expect the Fed to leave rates unchanged in December, but dialled back expectations of rate cuts in 2024, according to CME’s FedWatch Tool.

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Gold slips below US$2,000 level as dollar halts slide

Lower interest rates decrease the opportunity cost of holding gold.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.13 per cent to 882.28 tonnes on Wednesday from 883.43 tonnes on Tuesday.

Spot silver was flat at US$23.63 per ounce, while platinum was little changed at US$922.73. Palladium eased 0.1 per cent to US$1,056.63 per ounce. REUTERS