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Gold prices edged up on Tuesday as the
dollar eased, even as investors kept a keen eye on posturing
from major central banks on interest rate hikes for a clearer
outlook for bullion.
FUNDAMENTALS
* Spot gold was up 0.2% at $1,841.01 per ounce as of
0047 GMT. U.S. gold futures firmed 0.1% to $1,843.10.
* The dollar weakened slightly, making
greenback-priced bullion more attractive for buyers holding
other currencies.
* However, benchmark U.S. 10-year Treasury yields
rose, making bullion less appealing, after U.S.
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stock and bond markets were shut on Monday for the Juneteenth
holiday.
* Gold traded in a tight range on Monday as an easing dollar
and economic worries countered concerns around aggressive
monetary tightening by the Federal Reserve.
* The U.S. central bank could raise interest rates swiftly
this year and forge a “stellar” economy ahead if it can pull off
a repeat of the success of the central bank’s 1994 tightening
cycle, St. Louis Fed President James Bullard said on Monday.
* A series of surprise actions by some of the world’s
largest central banks fretting about runaway inflation has left
bond investors battered. Now, a growing chorus of investors is
calling on policymakers to move fast to end the uncertainty.
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* Although bullion is often seen as an inflation hedge,
higher interest rates and bond yields increase the opportunity
cost of holding gold, which yields nothing.
* The European Central Bank will not revisit its decision to
raise interest rates by 25 basis points at its July 21 meeting
but the size of its September hike is still to be decided, ECB
Chief Economist Philip Lane said on Monday.
* Spot silver was up 0.4% at $21.67 per ounce,
platinum edged 0.1% up to $932.58, and palladium
gained 0.8% to $1,861.94.
DATA/EVENTS (GMT)
1400 US Existing Home Sales May
(Reporting by Bharat Govind Gautam in Bengaluru; Editing by
Shailesh Kuber)
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