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IPMI and Industry News: Gold Market News

Gold eases as dollar recovers; all eyes on Fed meeting

Wednesday, September 16, 2020   (0 Comments)
Posted by: Matt Watson
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Gold eases as dollar recovers; all eyes on Fed meeting

An employee arranges one kilogram gold bars at the Perth Mint Refinery in Perth, Australia, on Aug. 9, 2018.

An employee arranges one kilogram gold bars at the Perth Mint Refinery in Perth, Australia, on Aug. 9, 2018.
Carla Gottgens | Bloomberg | Getty Images

Gold edged lower from a near-two week high on Tuesday as the dollar rose, although hopes for a dovish monetary policy stance from the U.S. Federal Reserve limited the safe-haven metals’ losses.

 

Spot gold was down 0.1% to $1,955.21 per ounce, after earlier climbing to its highest since Sept. 2 at $1,971.71. U.S. gold futures settled up 0.1% at $1,966.20.

 

“The dollar bounced off the lows and we’re seeing some sell-off in gold, but this is temporary, dovish comments from the Fed meeting and a further explanation on their new inflation targets could push gold above $2,000,” said Bob Haberkorn, senior market strategist at RJO Futures.

 

The dollar index rose against rivals, making gold more expensive for buyers holding other currencies.

 

Investors are now awaiting a statement from the Fed’s two-day policy event, which ends on Wednesday.

 

“There is more optimism because investors are thinking the low interest rates we have can continue for the next three-plus years; that’s very bullish for gold,” said Michael Matousek, head trader at U.S. Global Investors.

 

Meanwhile, a group of Democratic and Republican members of U.S. Congress unveiled a $1.5 trillion bipartisan coronavirus relief legislation, which they hoped would break a deadlock.

Unprecedented monetary stimulus and a low interest rate environment have led bullion to gain 29% this year, as it is seen as a hedge against inflation and currency debasement.

 

Elsewhere, silver rose 0.2% to $27.20 per ounce, while palladium climbed 3.8% at $2,400.25, having hit its highest since March 31 at $2,419.19.

 

Platinum rose 1.7% to $970.47, after hitting its highest since Aug. 11 at $973.98.

Platinum could outperform gold by about 10%, if the World Platinum Investment Council’s forecasts for a supply deficit come to pass and the gold-to-platinum ratio breaks out of the 2.02-2.20 range, said Saxo Bank analyst Ole Hansen.


Read the full article at:  https://www.cnbc.com/2020/09/15/gold-markets-federal-reserve-coronavirus.html

 

 

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