Gold Up as Dollar Rally Eases on Uncertainty over Scale of U.S. Interest Rate Hike
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By Zhang Mengying
Investing.com – Gold was up on Friday morning in Asia as the dollar rally eased on uncertainty over the scale of the U.S. interest rate hike.
Gold futures inched up 0.04% to $1,706.50 by 11:58 PM ET (0358 GMT). The dollar, which normally moves inversely to gold, jumped on Friday morning.
“Gold has wilted in the face of a stronger U.S. dollar this week but appears to be trying to form a temporary base ahead of $1,700.00. That said, it is displaying no signs of meaningful upside momentum with rallies limited to the $1,750.00 region,” OANDA senior analyst Jeffrey Halley told Reuters.
“In the bigger technical picture, gold still looks vulnerable, with risks skewed to the downside,” Halley added.
In the latest Fed comments, Governor Christopher Waller supported raising rates by 75 basis points this month, though he said he could go bigger if warranted by the data.
St. Louis Fed President James Bullard echoed some of those comments, saying he favored hiking by the same amount, not the bigger rate hike investors had raced to price in after Wednesday data showed inflation was accelerating.
“Investment demand for gold is weakening,” ANZ Research said in a note, adding that gold will remain under pressure from expectations of a large Fed rate hike.
In other precious metals, silver edged up 0.12%. Platinum fell 0.24%, while palladium was up 0.18%.
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