Latest News

Gold prices rise on weaker dollar and reduced Fed rate hike bets

Gold prices rose?on Monday. This was largely due to a weaker dollar, and recent soft economic data which reduced expectations of a U.S. rate hike in the next month.

Gold spot rose 0.6%, to $4400.15 an ounce at 0710 GMT. Prices reached a two-month high in the last week.

U.S. Gold Futures for December Delivery edged up 0.4% to $4,456.50.

The U.S. Dollar?index fell by 0.2% making metals priced in greenbacks more affordable to other currency holders.

Tim Waterer, KCM Trade's chief market analyst, said that gold has risen to the top of the charts this week. "Soft inflation data have kept the U.S. Dollar under pressure, giving it extra room to move towards $4,400," he added.

"A sustained movement above $4,500?would?likely require additional dollar weakness?or a more pronounced pullback in energy costs."

The U.S. Federal Reserve has been expected to raise interest rates in the next month despite an unexpected drop in non-farm payrolls and data that shows only mild inflation in consumer prices.

CME's FedWatch Tool shows that traders now price in a 29% probability of a rate hike for September, down from 47% one month ago.

Investors are more likely to invest in non-yielding gold if interest rates drop.

The markets are now awaiting the minutes of the Fed meeting for July, which is due on Wednesday. These will provide further insight into policymakers' monetary policies.

A diplomatic source revealed that U.S. President Donald Trump’s envoys had met with Egyptian, Qatari and Turkish mediators on Sunday in Cairo, to discuss his Gaza peace plan, while Israel continued its airstrikes.

Silver spot rose by 1.8%, to $65.82 an ounce. Palladium rose 1.7%, or $1,334.77, and platinum gained 0.7%, to $1759.69. (Reporting and editing by Rashmia Aich and Mrigank Dahniwala in Bengaluru, and Sukanya Mittra in Bengaluru)

(source: Reuters)