PRECIOUS-Gold prices firm as rate-hike bets ebb; Fed minutes in focus
Shafaq News/ Gold held steady near a two-week high on Monday, as concerns eased over an earlier-than-expected rate hike by the Federal Reserve after a mixed bag of U.S. jobs data, while focus shifted to minutes from the U.S. central bank’s June policy meet.
Higher interest rates translate into a reduced opportunity cost of holding bullion, which pays no interest.
Spot gold was steady at $1,786.90 per ounce, as of 0524 GMT, after hitting its highest since June 18 at $1,794.86 on Friday. Most U.S. markets were closed on Monday for the Independence Day holiday.
U.S. gold futures rose 0.2% to $1,786.80.
“Last week’s payroll numbers provided a lot of mixed signals and the data wasn’t solid enough to move that Fed needle,” Stephen Innes, managing partner at SPI Asset Management, said.
“However, economic growth in the United States is quite strong, inflation is quite strong ... We have to be very cognizant as markets are still playing a hawkish Fed hand and this is going to limit gold topside ambitions.”
Data on Friday showed U.S. companies in June hired the most workers in 10 months, but unemployment ticked higher, workforce participation didn’t budge and the pace of hourly earnings growth slowed.
Meanwhile, a rebound in the U.S. labour market is strengthening investors’ focus on economic data and the Fed’s next move, as markets cheer further evidence of a robust economic recovery amid worries over persistent inflation.
Minutes of the Fed’s latest meeting due to be published on Wednesday could shed more light on policymakers’ views on inflation and monetary policy.
Spot gold may break a resistance at $1,789 per ounce and rise to $1,813，as suggested by its wave pattern and retracement analysis, said Reuters technical analyst Wang Tao.
Growth in China’s services sector slowed sharply in June to a 14-month low, weighed down by a resurgence of COVID-19 cases in southern China, a private survey showed on Monday.
Elsewhere, silver rose 0.3% to $26.53 per ounce, palladium gained 0.3% to $2,793.23, and platinum climbed 0.5% to $1,095.43.
Source: Reuters
