Gold Steadies as Haven Demand From Moody’s US Downgrade Fades
Gold steadied as the haven-demand boost from Moody’s Ratings downgrade of the US faded, and attention turned back to the Federal Reserve’s rate path and easing trade tensions.
Bullion was little changed at around $3,230 an ounce. The dollar was also flat, while US equity futures inched lower.
The precious metal rallied earlier in the year as US President Donald Trump’s aggressive trade policy rattled global markets, but the gains partially reversed this month as he paused or pulled back on many of his tariff threats, in particular those on China. Gold is still up by more than a fifth this year, however, driven higher by strong inflows in bullion-backed exchange traded funds and speculative demand from Chinese investors.
China imported the most gold in nearly a year last month despite record prices, after heightened demand for the precious metal prompted the central bank to ease restrictions on bullion inflows. Total gold imports to the country reached 127.5 metric tons, a 73% jump from a month earlier.
On Monday, two Federal Reserve officials, including New York Fed chief John Williams, suggested policymakers may not be ready to lower interest rates before September as they confront a murky economic outlook. Higher interest rates weigh on gold, which does not bear interest. Later Tuesday, Atlanta Fed President Raphael Bostic and St. Louis Fed President Alberto Musalem are set to speak.
Gold edged 0.1% higher to $3,233.34 an ounce at 11:21 a.m. in London. The Bloomberg Dollar Spot Index was practicaly unchanged. Silver and platinum rose, while palladium dropped.
Copper traded 0.2% lower on the London Metal Exchange.
Source: Bloomberg
