On January 31, 2023, a 99.99% pure gold ingot was placed in the workshop of the Krastsvetmet precious metals factory in the Russian Siberian city of Krasnoyarsk.
Alexander Manzuk | Reuters
Gold edged higher on Wednesday, helped by a weaker dollar, as slowing U.S. inflation bolstered bets the Federal Reserve would keep interest rates on hold later in the day.
spot gold It was up 0.3 percent at $1,948.49 an ounce by 05:00 GMT. US Gold Futures It edged up 0.2 percent to $1,961.70.
this Dollar Relaxation, making dollar-denominated bullion more attractive to overseas buyers.
U.S. consumer prices rose 4.0% in May, the smallest annual gain in more than two years, but still well above the U.S. central bank’s 2% target.
“The Fed, while likely to pause at this meeting, will certainly maintain a tightening bias for the foreseeable future (given core CPI at 5.3%),” said Clifford Bennett, chief economist at Xiwan Securities.
Federal Reserve officials met on Tuesday for the first time in 15 months without a predetermined rate hike, equating to the first gathering of the “will they or won’t they” era.
According to the CME’s Fedwatch tool, the market is pricing in about a 90% chance that the Fed will keep rates on hold.
“There’s a growing awareness that the Fed is unlikely to cut rates for the rest of the year, and a lot of investors have pulled out of the gold market recently,” Bennett said.
“Price action in the recent range warrants caution, but it does look like the buy side will win this epic fight.”
While gold is seen as a hedge against inflation, higher interest rates to curb price pressures typically affect the attractiveness of non-yielding assets.
“Gold remains in a bullish weekly channel and is bullish on medium to long-term time frames. It’s likely to stay that way, although it depends on the language (Fed) uses,” said Nicholas Frappel, head of global institutions. The market for the ABC refinery.
Spot silver rose 0.7% to $23.8439 an ounce, platinum rose 0.3% to $979.37, while palladium was flat at $1,361.01.