3.8 C
New York
Tuesday, November 30, 2021

Gold steady as focus returns to U.S. rate hike view

MANILA (Reuters) – Gold was steady on Monday after pulling back from a three-week high hit last week, as more upbeat U.S. economic data strengthened the dollar and the case for the Federal Reserve to hike interest rates next month.

FUNDAMENTALS

Spot gold was flat at $ 1,114.05 an ounce by 0038 GMT. The metal has come off Thursday’s three-week peak of $ 1,126.31, though still managed to snap a seven-week losing run.

U.S. gold for December delivery was little changed at $ 1,113.80 an ounce.

China’s devaluation of its yuan last week helped gold recover some lost ground, but bullion has pared some of those gains as fears abated that Beijing would pursue a sustained depreciation of its currency.

That has put the market focus back on a looming U.S. rates increase. U.S. industrial output advanced at its strongest pace in eight months in July in another bullish sign for third-quarter economic growth that boosts the prospects of a rate hike next month.

Minutes from the Fed’s July 28-29 meeting due on Wednesday will offer vital clues about its plan to hike rates for the first time since 2006, with rebounding retail sales, solid jobs growth and rising construction all pointing to next month as gross domestic product stays above trend for the world’s largest economy.

Hedge fund Paulson & Co cut its stake in the world’s biggest gold-backed exchange-traded fund in the second quarter of 2015, after holding it unchanged for six straight quarters, just before prices took a tumble.

Hedge funds and money managers sharply cut their net short position in COMEX gold contracts in the week ended Aug. 11, as the surprise devaluation of China’s currency lifted bullion prices further above a 5-1/2-year low, U.S. Commodity Futures Trading Commission data showed.

In Greece, Prime Minister Alexis Tsipras faced the widest rebellion yet from his leftist lawmakers as parliament approved a new bailout programme, forcing him to consider a confidence vote that could pave the way for early elections.

(Reporting by Manolo Serapio Jr.; Editing by Ed Davies)

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

10,920FansLike
12,893FollowersFollow
752FollowersFollow
- Advertisement -

Latest Articles

Popular Articles