Gold edges higher as dollar eases ahead of Fed minutes, data

GOLD prices ticked up on Tuesday (Feb 21) as the dollar eased off a six-week high, while traders waited for more economic data to gauge the US Federal Reserve’s rate-hike strategy.

Spot gold was up 0.1 per cent at US$1,843.23 per ounce, as of 0046 GMT. US gold futures firmed 0.1 per cent to US$1,851.80.

The dollar index was parked below recent peaks, making greenback-priced bullion less expensive for buyers holding other currencies.

Investors are now awaiting minutes of the Fed’s latest policy meeting due to be released on Wednesday. Money markets expect the US central bank to raise benchmark rates above 5 per cent by May, with a peak in rates seen at 5.3 per cent in July.

Higher interest rates increase the opportunity cost of holding zero-yield bullion.

The US core personal consumption expenditure (PCE) data due later this week is also on investors’ radar.

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Gold edges down on firmer dollar, US rate-hike worries

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The European Central Bank should keep raising interest rates beyond March and the rate peak, which should be stuck to for some time, could be reached over the summer, Finnish central bank chief Olli Rehn told a German newspaper.

Germany’s economic prospects are improving after an unexpectedly resilient fourth quarter with headline inflation also past its peak, even if underlying price growth will take longer to abate, the Bundesbank said on Monday.

Spot silver climbed 0.4 per cent to US$21.83 per ounce, platinum rose 0.2 per cent to US$928.65 and palladium firmed 0.1 per cent to US$1,512.07. REUTERS