Monday, June 17, 2024

As the dollar rises, gold falls

Date:

London (Reuters)

Gold prices edged lower on Friday as the yellow metal’s appeal faded due to a stronger dollar and fears of sharp interest rate hikes by major central banks to curb inflationary pressures. 0.2 percent is $1714.72 per ounce. Prices fell to a more than one-year low of $1,680.25 on Thursday, closing up 1.3 percent. Gold is up nearly 0.5%, heading for its first weekly gain in six weeks. U.S. gold futures were up 0.1 percent at $1,714.90 an ounce. The dollar rose 0.2 percent against rival currencies, making the price of gold higher in the U.S. currency for buyers of other currencies. “Gold is falling and the rallies that have started will be short-lived as gold is under pressure as inflation expectations decline,” said Edward Meier, analyst at ED&F Capital Markets. The European Central Bank joined its global peers in the fight against rising inflation by raising interest rates more than expected on Thursday, even as the euro zone economy was hit by the impact of Russia’s war on Ukraine. The US Federal Reserve’s policy meeting is scheduled for next week and policymakers are expected to raise interest rates by 75 basis points. “We are waiting to hear how tight they will be on interest rates. If they still think inflation is a problem or keep raising interest rates, that will have a very negative impact on gold,” Meir said. Higher interest rates increase the opportunity cost of owning the precious metal, which does not generate income. Data on Thursday showed the number of Americans filing for unemployment benefits last week rose to an eight-month high, in the latest sign that the economy is slowing under the weight of strong interest rates and inflation. In other precious metals, silver fell 0.3 percent to $18.78 an ounce in spot transactions, platinum rose 0.3 percent to $873.92 and palladium added 0.2 percent to $1895.86.

See also  The volatility in the performance of the region's markets comes with fears of an oil slump and rising interest rates
Nadia Barnett
Nadia Barnett
"Award-winning beer geek. Extreme coffeeaholic. Introvert. Avid travel specialist. Hipster-friendly communicator."

Share post:

Popular

More like this
Related

The easiest way to access the best UAE stocks

The most common way to invest in the UAE...

The Rising Demand for Model Ships in Dubai

Dubai, known for its stunning architecture and vibrant economy,...

Exhibition Stand Builders in Dubai

Dubai, a global hub for trade and commerce, is...

Unlocking the Power of Booking Engines in the Hospitality Industry

In an era dominated by technology, the hospitality industry...