NEW YORK: Gold slipped from a near two-week high on Tuesday as the dollar firmed, though losses were capped by bolstered bets on Federal Reserve rate cuts.
Spot gold was down 0.5% at $3,354.56 per ounce, by 1220 GMT. Bullion hit its highest since July 24 on Monday at $3,385.29. US gold futures also fell 0.5% to $3,408.20.
The dollar index rose 0.2% from a one-week low hit earlier in the session, reducing gold’s appeal to other currency holders. Data on Friday showed employment growth in the US slowed more than anticipated in July, with payroll revisions for May and June slashing a hefty 258,000 jobs from previous tallies.
The CME FedWatch tool now puts the odds of a September cut at nearly 88%, up from 63% a week earlier, with markets largely pricing in at least two quarter-point reductions this year.
“What gold needs to move higher from here is probably (another) weaker US economic data... The other item gold is watching is who US President Trump names as next Fed Governor, potentially the successor of Federal Reserve chairman Jerome Powell,” said UBS commodity analyst Giovanni Staunovo.
Trump’s dismissal of the labour statistics chief following the weak payrolls report, coupled with news that he will appoint a new Fed governor, added to uncertainty. Trump also threatened to lift tariffs on Indian goods beyond last month’s 25% hike, citing India’s continued purchases of Russian oil.
Gold, long seen as a safe haven in times of political and economic uncertainty, typically performs well in a low-interest-rate environment. “I still do not see traders pushing up aggressively above the $3,450 level unless we have a very clear catalyst,” OANDA senior market analyst, Kelvin Wong, said.
Elsewhere, spot silver rose 0.2% to $37.45 per ounce, platinum lost 1.1% to $1,314.50 and palladium shed 1.8% to $1,184.94. South Africa-based miner Sibanye-Stillwater has asked the United States to consider imposing a tariff on Russian palladium imports to support the long-term viability of US supplies.
Comments
Comments are closed for this article.