Gold prices stabilize as investors await US inflation data amid stronger dollar
Date
6/27/2024 4:11:05 AM
(MENAFN) On Thursday, Gold prices stabilized after hitting a two-week low in the previous session, as investors keenly awaited US inflation data for clues on the Federal Reserve’s potential interest rate reduction path. gold settled at USD2,299.55 per ounce in spot transactions by 0255 GMT, following a drop to its lowest levels since June 10 on Wednesday. Concurrently, US gold futures saw a slight decline of 0.1 percent, reaching USD2,310.20.
The dollar's strength, hovering near an eight-week high, has made gold more expensive for holders of other currencies. Tim Waterer, chief market analyst at KCM Trade, noted that the combination of a rising US dollar and higher bond yields has placed gold in a challenging position, akin to "swimming against the tide." Investors are now focused on the forthcoming GDP estimates for the first quarter in the United States, due at 1230 GMT, and the personal consumption expenditure inflation data expected on Friday.
While gold is traditionally viewed as a hedge against inflation, the prospect of high interest rates increases the opportunity cost of holding non-yielding assets like gold. This dynamic adds another layer of complexity to the precious metal's market performance.
Other precious metals also experienced movements: silver fell by 0.1 percent in spot transactions to USD28.74, platinum declined by 0.3 percent to USD1,007.33, while palladium saw a modest increase of 0.2 percent, rising to USD930.39. As investors continue to navigate these fluctuating conditions, the interplay between inflation data, interest rates, and currency strength remains a focal point in the precious metals market.
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