Gold Prices Rise as Trump Piles More Pressure on Fed; Central Banks Still Buyers

© Reuters. © Reuters. – prices rose as U.S. President Donald Trump stressed that the should lower rates and a survey showed that central banks worldwide were planning to increase reserve holdings.

for August delivery on the Comex division of the , rose $5.85, or 0.4%, to $1,433.95 a troy ounce by 10:26 AM ET (14:26 GMT).

In several tweets, Trump reiterated his and accused the Fed of sticking to a “faulty thought process” as markets contemplate the possibility of a 50-basis-point cut at the July 30-31 policy meeting.

Although Fed Chairman Jerome Powell has repeatedly shrugged off Trump’s attacks, citing the central bank’s independence and a lack of necessity to responding to short-term political pressure, markets are convinced there will be at least a quarter-point cut and there’s a 60% chance rates will be 50 basis points lower after the September policy meeting, according to’s .

Article continues below Advertisement...

Beyond the Fed, central banks worldwide have been taking an increasingly dovish stance with regard to monetary policy to the benefit of non-yielding gold.

The is widely expected to give signs of further easing next week, with market odds for a cut having even surpassed 50% on Friday, while smaller central banks such as South or already took action on Thursday.

The outlook for lower interest rates has spread across the fixed income market resulting in $13 trillion worth of bonds with negative yields, increasing the appeal of gold.

John Reade, chief market strategist at the World Gold Council, compared the performance of gold to bond yields in a series of tweets and reminded his followers that “zero is just a level, not a floor”.

In another bullish factor for the outlook, the “hoarding” of gold by central banks looked set to continue for the following year, according to a conducted by the World Gold Council and YouGov.

According to the poll of central banks, 54% of respondents expect global holdings to climb in the next 12 months amid concerns about risks in other reserve assets.

In other metals trading, rose 0.6% at $16.293 a troy ounce by 10:28 AM ET (14:28 GMT).

fell 0.4% to $1,506.00 an ounce, while sister metal gained 0.5% to $854.40.

In base metals, traded up 1.9% to $2.762 a pound.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, ) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the , it is one of the riskiest investment forms possible.