Gold edged lower on Monday morning as the dollar and yields strengthened after Friday's decline after Federal Reserve Chairman Jerome Powell signaled an interest rate cut was imminent.
Gold for December delivery last traded down US$5.70 at US$3,412.80 per ounce.
The price of the precious metal rose sharply on Friday following Powell's speech at the Fed's annual Economic Policy Symposium in Jackson Hole, Wyoming. While he gave no indication that a rate cut would be made at the conclusion of the Fed's next policy committee meeting on September 17, he did signal that changes to the bank's benchmark interest rate policy were imminent as the US economy slows.
"Our policy interest rate is now 100 basis points closer to neutral than it was a year ago, and the stability of the unemployment rate and other labor market indicators allows us to proceed cautiously while considering changes to our policy stance. However, with policy in restrictive territory, the underlying outlook and shifting balance of risks may require adjustments to our policy stance," Powell said in his speech.
The dollar recovered on Monday morning after falling to its lowest level in a month on Friday following Powell's speech, which signaled weakness for commodities priced in the currency. The ICE dollar index was last seen up 0.19 points at 97.91.
US Treasury yields also moved higher after falling on Friday. The two-year US Treasury yield was last seen up 2.5 basis points to 3.734%, while the 10-year Treasury yielded 4.282%, up 1.7 basis points. (alg)
Source: MT Newswires
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