Investors’ attention now turns to the Fed’s latest policy meeting minutes, scheduled for release on Wednesday, and inflation statistics, scheduled for release on Friday.
Gold prices rose on Tuesday as the dollar hovered near a seven-week high as markets awaited the release of the Federal Reserve’s minutes from its last meeting and additional economic data for further insight into the trajectory of U.S. monetary policy. The stock fell slightly during trading.
In the UAE, gold rates rose by Dh0.25, with 24 carat gold rising to Dh320 and 22 carat gold flat at Dh296.25. Meanwhile, 21 carat gold reached Dh286.75 and 18 carat gold reached Dh245.75.
Globally, spot gold fell 0.02% to $2,642.78 as of 5:13 p.m. Japan time, while U.S. gold futures fell 0.18% to $2,661.10.
dollar regains momentum
The dollar index fell 0.11% to 102.42, but remained close to a seven-week high, boosting the price of gold for other currency holders. Meanwhile, the yield on the benchmark 10-year U.S. Treasury note rose above 4% for the first time in more than two months.
The recovery in both the dollar and bond yields is impacting gold prices. However, geopolitical tensions remain a tailwind, increasing demand for safe bullion amid economic and political uncertainty.
Fed meeting minutes
Investors’ attention now turns to Thursday’s U.S. consumer price index and Friday’s producer price index, as well as Wednesday’s release of the Fed’s latest policy meeting minutes. Additionally, traders are awaiting comments from multiple Fed officials this week to determine the size of the next rate cut.
If U.S. inflation data suggests rising price pressures, gold prices could also come under downward pressure as the dollar strengthens further.
Stronger-than-expected jobs data released last week weighed on market expectations for a 50 basis point rate cut at the November Fed meeting. The market is no longer pricing in a 50 basis point cut, and now sees an 87% chance of a 25 basis point cut, according to the CME FedWatch tool.
Read: Global gold prices fall as UAE firmly bets US will narrow interest rate cut in November
Other precious metals
As gold prices fell, precious metals prices also trended downward. Spot silver fell 1.07% to $31.38 an ounce, platinum fell 0.61% to $966.26 and palladium fell 2.12% to $1,002.30.
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