Investing.com – Gold prices rose to fresh two-week highs on Thursday as the dollar reversed early gains and U.S. stocks opened lower as a spike U.S. bond yields weighed, bolstering safe haven demand for the precious metal.
December were up $4.90 or 0.4% to $1,207.70 by 09:59 AM ET (13:59 GMT) on the Comex division of the New York Mercantile Exchange, the highest since Sept. 24.
The dollar was broadly lower, with the , which measures the greenback’s strength against a basket of six major currencies, down 0.32% to 95.36 after hitting a one-and-a-half month high of 95.78 earlier.
A weaker dollar can make dollar denominated assets, like gold, less expensive to potential buyers holding other currencies.
Safe haven demand for gold was underpinned after a amid a spike in Treasury yields on and indications from the Federal Reserve that interest rates will continue to rise.
Fed Chairman Jerome Powell said Wednesday that above an estimated “neutral” setting as the U.S. economy continues to grow.
The hawkish sounding remarks bolstered expectations for the Fed to hike interest rates again in December and beyond.
Expectations for rising interest rates look likely to remain a headwind for gold prices. Interest rate increases and higher U.S. bond yields dampen appeal for gold, which offers no yield. They also tend to boost the dollar.
While gold is on track for a weekly gain, the precious metal had ended the third quarter down 4.6% after falling 0.9% in September as rising U.S. interest rates and the dollar’s march higher in 2018 weighed.
Elsewhere in metals trading, December advanced 0.55% to $14.74 a troy ounce, while January was trading at $833.00, off 0.35% for the day.
Among base metals, December added on 0.25% to trade at $2.838.
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