Gold prices were steady on Wednesday and hovered above key $2,400 level touched earlier this week, supported by safe-haven buying and the prospect of interest rate cuts from the US Federal Reserve later this year.
Fundamentals
-
Spot gold held its ground at $2,422.45 per ounce, as of 0106 GMT. Bullion hit a record high of 2,449.89 on Monday.
-
US gold futures were steady at $2,426.00.
-
Recent data suggested that US inflation resumed its downward trend, but several Fed policymakers remained cautious on cutting rates too soon and ruled out the need for a hike.
-
Fed policymakers said the US central bank should wait several more months to ensure that inflation really is back on track to its 2% target before cutting interest rates.
-
Bullion is known as an inflation hedge, but higher rates increase the opportunity cost of holding non-yielding gold.
-
US households continued to feel pinched by inflation in late 2023 even as price pressures ebbed with most Americans saying their financial situation had changed little in the last year.
-
The minutes of the Federal Reserve’s last policy meeting, expected at 1800 GMT, could offer more insights into the timing of widely expected interest rate cuts.
-
The Shanghai Futures Exchange will raise the trading limit and margin requirements for gold and silver futures contracts from May 23.
-
Emboldened by China’s latest measures and pledges to fix the weakest parts of its struggling economy, domestic investors are scooping up shares in a cheap stock market, while most foreign investors are hopeful but taking it slow.
-
Elsewhere, Israel urged “nations of the civilised world” to oppose the International Criminal Court prosecutor’s request for arrest warrants against its leaders, and to declare they would ignore the warrants.
-
Spot silver rose 0.4% to $32.08 per ounce, platinum was up 0.4% at $1,050.50 and palladium was flat at $1,025.75.
Comments
Comments are closed for this article.