Gold Prices Near 4-Month Highs as Dollar Gives Up Gains

Investing.com – Gold prices remained close to four-month highs on Wednesday amid expectations the precious metal would likely ‘shrug off’ rate hike worries while dollar weakness limited downside.

for February delivery on the Comex division of the New York Mercantile Exchange fell by $1.60, or 0.12%, to $1,335.50 a troy ounce.

“We expect gold will shrug off worries of fundamental downside amidst the unwind of accommodative central bank policy, and that the market premium over fair value will widen,” Deutsche Bank said.

The bank forecasts gold for 2018 at $1,283 an ounce, which takes into account market expectations of four Fed rate hikes and modest dollar weakness.

In a rising interest rate environment, investor appetite for gold weakens as the opportunity cost of holding the precious metal increases relative to other interest-nearing assets such as bonds.

The positive sentiment on the precious metal was supported by data showing traders continued to increased their bullish bets on gold for the fourth-straight week.

Speculative net long position in gold rose by 40,000 contracts to a net long 203,300 contracts, a six-week high, according to the most recent Commitment of Traders (COT) report.

In other precious metal trade, fell 0.20% to $17.16 a troy ounce, while rose 0.59% to $1010.80.

fell 0.98% to $3.19, while rose 4.06% to $3.26.

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.