Investing.com – Gold prices fell to one-and-a-half week lows on Thursday, after the minutes of the Federal Reserve’s latest policy minutes pointed to the need for further interest rate hikes, sending the U.S. dollar higher.
Comex were down 0.62% at $1,323.7 a troy ounce by 02:00 a.m. ET (06:00 GMT), the lowest since February 14.
The of the Fed’s January policy meeting released on Wednesday showed that central bank officials see increased economic growth and rising inflation as justification .
The news lent broad support to the greenback despite sustained worries over the U.S. deficit, which is projected to climb near $1 trillion in 2019 following the recent announcement of infrastructure spending and large corporate tax cuts.
Gold is sensitive to moves in both U.S. rates and the dollar. A stronger dollar makes gold more expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.
The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.13% at 90.14, the highest since February 12.
The dollar had been pressured lower recently by expectations for a faster pace of monetary tightening outside the U.S., which would lessen the divergence between the Fed and other central banks.
Elsewhere on the Comex, lost 1.34% to $16.39 a troy ounce.
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Source: Investing.com
