24.5 C
New York
Tuesday, July 5, 2022

Gold Prices Top 4-Month High as Dollar Continues to Slide

Gold Prices Top 4-Month High as Dollar Continues to Slide

Investing.com – Gold prices rose to nearly a five-month high on Tuesday as a continuing decline in the dollar boosted foreign demand for the precious metal, while investors shift attention to the next Federal Reserve policy meeting.

At 9:49 AM ET (14:49 GMT), for February delivery on the Comex division of the New York Mercantile Exchange gained $6.20, or 0.50%, to $1,245.50 a troy ounce, after touching $1,247.40 earlier, its highest level since July 11.

Meanwhile, the U.S. , which tracks the greenback against a basket of six major currencies, was down 0.36% to 96.623.
Weakness in the American currency increases the appeal of dollar-denominated gold as it becomes more affordable for holders of foreign currencies.

The dollar index rose to the highest levels of the year in early November, supported by a robust U.S. economy and a relatively hawkish Fed, which forecast moving ahead with gradual rate hikes.

But as the Dec. 18-19 monetary policy just over the horizon, the greenback came under pressure last week when the market took comments from Fed chairman Jerome Powell as signaling a slower pace of rate hikes.

That more dovish tone led markets to question how many times the central bank will hike rates in 2019.

“Given data remains strong, we think the Fed will hike twice in 2019 and that’s more than what the market is pricing in right now…we remain moderately bullish on the dollar,” said Nick Twidale, chief operating officer at Rakuten Securities.

Although the Fed’s economic projections pointed to a total of three rate increases next year, policymakers will update the dot-plot that shows their outlook for interest rates at the upcoming meeting.

A slower-than-expected pace of interest rate increases would lessen the pressure on non-yielding bullion.

Powell was scheduled to appear before Congress’s Joint Economic Committee on Wednesday, but the testimony was postponed after U.S. President Donald Trump declared a national day of mourning following the death of President George H.W. Bush. The testimony had yet to be rescheduled.

In other metals trading, advanced 1.30% at $14.688 a troy ounce 9:50 AM ET (14:50 GMT).

gained 0.73% to $1,174.10 an ounce, while sister metal fell 0.93% at $803.15

In base metals, traded down 0.52% to $2.795 a pound.

— Reuters contributed to this report.

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, futures) 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 financial markets, it is one of the riskiest investment forms possible.

Source: Investing.com

Related Articles

Stay Connected

- Advertisement -

Latest Articles

Popular Articles