Gold tries to recover from 5-week low as dollar falls
Gold rose as the European market opened today, trying to rebound from the 5-week low it hit yesterday, which is supported by US dollar drop against a basket of major currencies.
Gold rose by 0.4% to $1,499.00 an ounce, from the opening of $1,493.56, with an intraday low of $1,488.94.
Gold closed lower by 0.5% yesterday, its third daily loss in 4 days, at a 5-week low of $1,483.04 after the US Fed meeting.
The dollar index fell today by 0.25% against a basket of major currencies, which favor most metals and commodities denominated in dollars.
This dollar's drop is due to growing uncertainty about the US Fed monetary policy approach, especially after mixed signals from the bank while President Trump continues to demand more cuts.
Yesterday, the US Federal Reserve cut interest rates today by 25 basis points, which is the second rate cut since 2008, to protect the US economic growth.
The vote for the cut was 7 vs. 3 members of the FOMC, which resulted in lowering the lending rate to 1.75% from 2.00%.
US Federal Reserve Chairman Jerome Powell said that the US economy and the labor are still strong, and the cuts are measures to protect the economy, and stated that any decisions to cut or raise interest rates will be based on the economic situation.
Gold holdings at the SPDR Gold Trust, rose yesterday by 3.23 metric tons, to a total of 883.6 metric tons.
British retail sales fall - August
The British economy released at 08:30 GMT, its monthly reading for the retail sales, which fell by 0.2% in August, in line with forecasts, while lower than the previous reading of a rise by 0.4% after it was revised from 0.2%.
This data is considered negative for the British economy.