On Monday, the price of gold increased slightly after five consecutive sessions of decline, reaching a 5-month low. This rise in value comes as investors prepare for the upcoming gathering of central bankers in Jackson Hole, Wyoming. During this event, they will discuss the future of the economy and interest rates.
The price of spot gold, represented by XAU=, increased by 0.3% and is now valued at $1,892.88 per ounce as of 0446 GMT. Similarly, U.S. gold futures, represented by GCcv1, also rose by 0.3% and now has a value of $1,921.70.
Last week, the price of gold fell to its lowest point since mid-March at $1,883.70. This was due to positive economic data leading to predictions of higher and longer-lasting U.S. interest rates, which decreased the demand for gold, a non-yielding commodity.
According to KCM Trade Chief Market Analyst Tim Waterer, the dollar index remains above 103, making it difficult for assets like gold to make progress. Investors are looking forward to U.S. Federal Reserve chair Jerome Powell’s speech on Friday, as central bankers from around the world gather for their annual conference in Jackson Hole.
Waterer suggested that it would be interesting to see if the hawkish sentiment from the latest FOMC minutes is echoed by Fed Chairman Jerome Powell.
A recent Reuters poll suggests that most economists believe the Federal Reserve is unlikely to further raise interest rates. In fact, a majority of them predict that the central bank will wait until the end of March before considering any cuts.
The increasing yields of Treasury bonds and mortgage rates for homes might lower the backing for additional interest rate hikes at the Fed. The possibility of these hikes has already decreased due to lower inflation.
Asian markets experienced a setback as China implemented a smaller reduction to lending rates than what was expected by the market. This is part of Beijing’s trend of underwhelming stimulus measures. The abbreviation MKTS/GLOB refers to global markets.
On Friday, the SPDR Gold Trust GLD, which is the biggest gold-backed exchange-traded fund globally, announced a 0.3% increase in its holdings. This marks its first inflow since late-July and was reported under the symbol GOL/ETF.
Silver prices, represented by spot silver XAG=, increased by 0.7% to reach $22.85 per ounce. Platinum XPT= also rose by 0.1% to $910.83. Meanwhile, palladium XPD= saw a gain of 0.2% and reached $1,258.49.