Gold prices climb, set for fourth straight month of gains on rate cut cheer
Gold prices rose on Friday and were headed for a fourth straight month of gains in November on growing confidence the U.S. Federal Reserve will cut interest rates in the coming month.
Trading of gold futures, meanwhile, was impacted by an outage at CME Group which disrupted its platforms for futures ranging from commodities and currencies to stocks and bonds. Gold futures were last exchanging hands at $4,221.30 per ounce prior to the outage.
CME said some operations on exchanges it oversees have been partially restored, and it was working to reopen other affected services.
Bullion prices briefly fell in the prior session, but rapidly resumed their ascent as traders largely backer their bets on a December cut.
Markets are pricing in a roughly 85% chance the Fed will cut rates by a quarter of a percentage point at the end of its December 9-10 meeting, up sharply from last week, CME Fedwatch showed.
Hopes for a rate reduction next month have been boosted by dovish comments from some Fed officials, as well as recently underwhelming U.S. economic data. However, other policymakers have called for a more cautious approach to rate changes due to a lack of fresh economic data because of record-long federal government shutdown.
Speculation over the possible appointment of White House economic adviser Kevin Hassett to the Fed Chair role has added another layer to the debate around borrowing costs. Analysts have suggested that Hassett could advocate for a tilt toward faster and more aggressive easing, a dynamic that could bode well for gold.
The yellow metal, a non-yielding asset, tends to perform better in lower rate environments. Spot gold rose 0.4% to $4,175.06 an ounce by 07:47 ET (12:47 GMT). Gold is up more than 2% over the past one-week period, and is on pace to notch a fourth straight month of gains.(yds)
Source: Investing.com
