Gold Hovers Near Record as Traders Digest Latest Fed Comments
Gold hit another all-time high as traders parse the latest remarks from Federal Reserve officials and prepare for key US economic data.
Bullion was little changed after earlier rising as much as 0.4% to a record $2,640.11 an ounce, beating the previous all-time high set on Monday. Gold has advanced since the Fed lowered its benchmark interest rate by half a percentage point last week, building on what was already a record-setting year for the precious metal.
"While record high prices may dissuade some investors, we see several reasons why the rally still has room to run," UBS Group AG said in a report. "More Fed easing is coming," geopolitical tensions are worsening and demand from investors and central banks remains strong, it said.
Fed Governor Michelle Bowman is speaking Tuesday, potentially adding to recent comments from other Fed officials about rate cuts.
US economic data due later this week, including personal consumption expenditure figures, will also likely play into market expectations of the central bank's next moves. Lower rates are often seen as positive for non-interest bearing gold.
Apart from the expectations of Fed rate cuts, bullion's more than 27% rally so far this year has also been supported by robust purchasing by central banks and haven demand amid ongoing conflicts in the Middle East and Ukraine.
Spot gold was broadly steady at $2,632.64 an ounce by 11:17 a.m. in London. The Bloomberg Dollar Spot Index inched lower while the US 10-year Treasury yield rose. Palladium, platinum and silver all gained.
Source : Bloomberg
