Gold rises as the US dollar falls; traders focus on Fed rate hike path

Gold prices gained on Monday, aided by a small drop in the US dollar and as investors reduced their bets on the Federal Reserve raising interest rates by 100 basis points this month.

By 0254 GMT, spot gold had risen 0.4% to $1,713.49 per ounce, after plunging to its lowest level in over a year last week. Gold futures in the United States rose 0.5% to $1,711.80.

The dollar fell 0.1% against its peers, pulling away from a near 20-year high reached last week and making greenback-priced bullion less expensive for buyers holding other currencies. [USD/]

"After Friday's University of Michigan inflation component came in weaker, the market scaled back the assumption of a 100-bp rate hike," said Stephen Innes, managing partner at SPI Asset Management.

According to the preliminary July consumer survey conducted by the University of Michigan, people expect inflation to be 2.8% over a five-year horizon, the lowest in a year and down from 3.1% in June.

"Central bank hawkishness has already been priced in, and with gold staying at $1,700 per ounce last week, we may see shorts squeezed a bit as hawks may be unhappy with the Fed just rising rates by 75 basis points next week."

To tackle surging inflation, Fed members hinted on Friday that they will stick to a 75-bp rate increase at their July 26-27 meeting.

At its policy meeting later this week, the European Central Bank is anticipated to hike interest rates by 25 basis points. Although gold is viewed as an inflation hedge, rising interest rates reduce the appeal of bullion, which has no interest bearing value.

Comments

Stock futures fall after major averages show more losses to start the week.

Stock futures went down Tuesday morning after the Bank of Japan said it would change its yield target range. Futures linked to the Dow Jones Industrial Average fell by 236 points, or 0.72 percent. Both S&P 500 futures and Nasdaq 100 futures fell by 0.86 and 1.05 percent, respectively. During regular trading on Monday, the Dow lost more than 162 points, or about 0.5%. The S&P 500 lost 0.9%, and the Nasdaq Composite lost nearly 1.5%. Stocks are likely to end the month and the year in the red, and investors' hopes for a Santa Claus rally are fading fast. "There's still no sign of Santa. "Harness up," said Louis Navellier, who started the growth investing firm Navellier & Associates. "One would like to think all the bad news is out. There are no more Fed moves until at least February. We're not getting worse, but we're also not making up for last week's losses." Investors worried that the Federal Reserve could tip the economy into a ...

A change to Ethereum could make a new group of crypto kingpins.

The long-awaited update to Ethereum will add new people to the blockchain ecosystem, who will be called builders. This could change the power structure of what is arguably the most important cryptocurrency network for business. Under the current system, networks of computers called "miners" pull transactions from a special data pool and put them into blocks, which are then added to the blockchain. As part of a plan to cut down on energy use, the miners are being fired. After the Merge update, which is set to happen in September, the builders will put transactions into blocks and send them to the validators. The validators will agree on the order of the blocks that will make up the upgraded blockchain by signing their names. This geeky-looking change, which is part of an upgrade to the software called MEV-Boost, could make Ethereum more centralized, at least at first. Even though there are already more than 416,000 validators ready to process transactions, only a few people ha...

Sensex soars 460 points, Bank Nifty rises 0.45%, and Nifty finishes above 18400; M&M wins.

Sensex, Nifty, and Share Prices Today LIVE: Bulls end a two-day losing streak as NSE Nifty and BSE Sensex rise. Sensex soars 460 points, Bank Nifty rises 0.45%, and Nifty finishes above 18400; M&M wins. The Nifty rose 150 points to 18,420 despite a flat beginning. Sensex gained 0.76 percent at 61,806. The Nifty Junior or Next 50 rose nearly 1% as intraday markets turned green. Nifty Auto gained 1.59% today and led the industry. KFin Technologies' IPO launched today with a price range of Rs. 347-366 per share. 18,888 is Nifty's biggest hurdle "Wall Street was positive due to short covering and value buying. All sectoral indexes except IT ended in the green, with auto and FMCG reporting the most gains. . net/YwotbKdP4sVunJGfdhmgww/e8f260a6-84bf-4222-a093-e1ef14e44c00/ The 21 December RBI MPC minutes will be widely monitored. In the following months, the market will be looking for signals concerning inflation and the RBI's policy. Continue to look up "December ma...

Search This Blog