- National Highway construction slows to 20.43 km per day in first 4 months of current fiscal
- Independence Day Special: How investment habits, preferences of people have changed over the past 75 years
- BMW M4 Competition Coupé 50 Jahre M Edition: Price and features | Photos
- Financial Independence for Women: top investment tips for the other half to make them independent moneywise
Gold ticks lower on firmer dollar after Fed cranks up rates
Gold prices inched lower on Thursday, as the dollar recovered slightly after a large but widely expected interest rate hike by the U.S. central bank sent the currency tumbling in the previous session.
Gold prices inched lower on Thursday, as the dollar recovered slightly after a large but widely expected interest rate hike by the U.S. central bank sent the currency tumbling in the previous session. Spot gold fell 0.1% to $1,831.63 per ounce, as of 0235 GMT, while U.S. gold futures rose 0.8% to $1,833.40.
The conflicting currents of support from potential safe-haven demand and inflationary hedge buying versus pressure from a higher interest rate regime are keeping gold prices balanced, said Michael McCarthy, chief strategy officer at Tiger Brokers, Australia.
Higher short-term U.S. interest rates and bond yields increase the opportunity cost of holding bullion, which yields no interest.
The U.S. Federal Reserve on Wednesday approved a 75-basis-point interest rate hike, its largest in more than a quarter of a century, to stem a surge in inflation, and flagged a slowing economy.
"Gold has been remarkably range-bound for weeks now (despite major news)... and it`s a real head-scratcher for traders at the moment to work out what exactly will drive gold out of this range," McCarthy said, adding the dollar`s overall upward trend presented a cautious outlook for gold.
The Fed`s announcement drove longer-dated U.S. government bond yields lower and nudged the dollar off two-decade highs, which took gold as much as 1.9% higher in the previous session.
Meanwhile, Asian stocks rose on Thursday, carrying momentum from a global equities rally overnight.
However, key investors with big positions in gold know that the economic outlook is still challenging and still prefer to hold bullion as a safe-haven asset, said Brian Lan, managing director at dealer GoldSilver Central.
Spot silver firmed 0.1% to $21.67 per ounce, platinum gained 0.2% to $940.98, and palladium rose 0.5% to $1,870.79.
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.