Gold prices rallied on Friday (September 20th) and headed for a fifth straight weekly gain, with market attention focused on further cues after the US Federal Reserve's first interest rate cut of the year.
Spot gold rose 0.8% to $3,672.08 an ounce at 1:36 PM EDT (17:36 GMT). Prices have risen 0.8% so far this week. US gold futures for December delivery closed up 0.7% at $3,705.80.
The US central bank cut its benchmark interest rate by 25 basis points on Wednesday, but tempered the move with a warning about persistent inflation, raising doubts about the pace of future easing.
Following the decision, spot gold hit a record high of $3,707.40 before weakening in volatile trading. "Gold is still quite strong here and is just taking a pause after the Fed. The bullish trend remains intact with new highs inevitable, and realistically, we could see $4,000 before the end of the year," said RJO Futures market strategist Bob Haberkorn. Minneapolis Fed Bank President Neel Kashkari said labor market risks justify this week's interest rate cut and the possibility of tapering at the central bank's next two meetings.
Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold. The metal also tends to perform well during periods of uncertainty and has gained nearly 40% so far this year. Physical gold premiums in India rose to a 10-month high this week as record prices ahead of the holiday season failed to deter investors from buying bullion in anticipation of further gains, while discounts in China widened to a five-year peak.
Elsewhere, spot silver rose 2.2% to $42.70 an ounce, and platinum gained 1.4% to $1,403.02. Palladium held steady at $1,150.04 and is headed for a weekly loss. "What I'm seeing is a lot of investors are now turning to platinum and silver because they're more affordable than gold," Haberkorn said. (alg)
Source: Reuters
Gold prices weakened slightly on Thursday (February 12th), as more solid US employment data reduced market confidence in an imminent Federal Reserve interest rate cut. The strong employment data promp...
Gold prices strengthened on Wednesday, supported by a weaker US dollar and falling US bond yields after the latest economic data reinforced the narrative that the Federal Reserve is likely to continue...
Gold experienced a slight correction in the European session on Tuesday (February 10th), but remained above $5,000/oz as the market held its breath ahead of a series of US data that could alter intere...
Gold held above the psychological $5,000 level at the start of the week, supported by a combination of factors that are "right" for the precious metal : physical demand from China, expectations of low...
Gold prices are still struggling to turn an intraday rebound into a sustained rally. After briefly falling to $4,654 (a four day low) and rebounding, prices were again rejected near $4,900. In the Eur...
Oil prices stabilized on Thursday (February 12th), as the market reassigned a risk premium to US-Iran tensions despite US inventory data showing swelling domestic supplies. This movement confirms one thing: geopolitical headlines are still more...
Gold prices weakened slightly on Thursday (February 12th), as more solid US employment data reduced market confidence in an imminent Federal Reserve interest rate cut. The strong employment data prompted market participants to shift expectations of...
The Hang Seng Index reversed its downward trend in Hong Kong on Thursday (February 12th), weakening by around 0.9% to around 27,000 after a strong session earlier. This decline halted the momentum of the short term rally, as investors began to...