Gold on track for fresh weekly profit ahead of Powell remarks

Economies.com
2023-12-01 06:59AM UTC

Gold prices rose in European trade on Friday, resuming gains and approaching 6-1/5 month highs again, while heading for the third weekly profit in a row as the dollar loses ground.

 

The decline comes ahead of two successive speeches by Fed Chair Jerome Powell later today, which will provide clues on the likely path ahead for US monetary policies.

 

Gold Prices Today 

 

Gold prices rose 0.35% to $2,043 an ounce, with a session-low at $2,036, after losing 0.4% yesterday, the first loss in six days on profit-taking away from a 6-1/5 month high at $2,052. 

 

Gold rose 2.6% in November, the second monthly profit in a row on active demand on non-yielding assets as investors expect the Federal Reserve to wrap up the current cycle of policy tightening.

 

Weekly Trades 

 

Gold prices are up over 2% so far this week on track for the third weekly profit in a row. 

 

The Dollar

 

The dollar index fell 0.25% on Thursday, resuming losses and rebounding from three-month lows against a basket of major rivals.

 

The decline comes following a string of bearish remarks by Fed officials, which eliminated the odds of another interest rate hike this year and boosted the chances of an interest rate cut next March. 

 

Fed Remarks

 

New York Fed President John Williams said on Thursday that interest rates have peaked out and that monetary policies have become sufficiently tight.

 

San Francisco Fed President Mary Dale said that interest rates are in a "very good spot" to control inflation right now.

 

US Rates

 

Odds for a surprise US interest rate hike at the Fed December meeting stand at just 3%.

 

Odds for an interest rate cut at the Federal Reserve March 2024 meeting stand at 42.5%. 

 

Powell

 

Now investors await crucial speeches by Fed Chair Jerome Powell later today to gauge the likely path ahead for policies and the official opinion on inflation right now.

 

The SPDR

 

Gold holdings at the SPDR Gold Trust fell 2.02 tonnes yesterday, the third decline in a row to a total of 876.51 tonnes, the lowest since November 13. 

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