25.2 C
New York
Monday, July 4, 2022

Gold eases in Europe

LONDON: Gold prices fell on Tuesday after a five-session rally, as the dollar steadied and investors awaited key central bank meetings for clues about rate hikes amid rising inflation concerns. Spot gold fell 0.3% to $1,802.00 per ounce by 1012 GMT. US gold futures were down 0.1 % at $1,804.90.

“There is a slight recovery in the dollar and this is not the best factor for gold. However, prices are not expected to fall sharply as investors have realized that risks are still just behind the corner,” said Carlo Alberto De Casa, external analyst at Kinesis Money.

The dollar recovered from a recent pullback, making bullion more expensive for holders of other currencies. The Bank of Japan and the European Central Bank are set to hold monetary policy meetings on Thursday, while the US Federal Reserve’s policy meeting is next week.

Gold, therefore, has not much room in the short term, said De Casa, adding: “Only a dovish Fed or a slowdown of USD could lift up gold to $1,900, otherwise it only has space for a moderate appreciation to $1,820-1,830.”

Gold is often considered an inflation hedge, though reduced stimulus and interest rate hikes push government bond yields up, increasing non-interest bearing bullion’s opportunity cost. “Despite a firmer US dollar, higher bond yields at times and firm stock markets, gold is holding its own above the psychologically important $1,800 per troy ounce mark,” Commerzbank analyst Daniel Briesemann said in a note, adding, bullion appears to be finding support from the ongoing inflation debate.

Fed Chairman Jerome Powell recently said the US central bank should start the process of reducing its support of the economy by cutting back on its asset purchases, but should not yet touch the interest rate dial. Elsewhere, spot silver fell 1% to $24.31 per ounce, platinum shed 1.1% to $1,045.60 and palladium inched 0.6% lower to $2,038.95.

Gold eases in Europe

Source: Brecorder

Related Articles


Please enter your comment!
Please enter your name here

Stay Connected

- Advertisement -

Latest Articles

Popular Articles