Gold prices were little changed on Monday as the prospect of imminent interest rate rises kept them near the five-week lows touched last week, while elections in Europe created uncertainty and fueled investor buying.
Spot gold was down 0.01 percent at $1,204.30 an ounce by 3:08 p.m. EST (1908 GMT). That compares with $1,194.55 last Friday, its lowest level since Jan. 31. U.S. gold futures settled up 0.1 percent at $1,203.10.
Investors are focusing on Wednesday’s Dutch elections. The chance of a eurosceptic party coming to power in the Netherlands is seen as small but a strong election performance could fuel speculation of a surprise result in French presidential elections in April and May. Wednesday is also the second day of the U.S. Federal Reserve’s two-day meeting. The widely expected decision to raise rates could boost the U.S. currency, which when it rises makes dollar-priced commodities more expensive for non-U.S. firms. “A rate rise from the Fed is pretty much priced in, we’re probably going to see two more hikes this year,” said Oxford Economics analyst Daniel Smith. “A period of higher rates will tend to mean pressure on gold prices.”
The statement from the Fed, due to be released Wednesday at 2 p.m. (1800 GMT) followed by a briefing at 1830 GMT, will be scrutinized for any changes in thinking among policymakers.
“Now, the debate shifts to Fed dots,” said Wayne Gordon, analyst for UBS Wealth Management, retaining a long view and target price for gold at $1,300 per ounce.
via Kitco
Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.
Alfonso Esparza
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Latest posts by Alfonso Esparza (see all)
- Market Rally Still Going Low Holiday Volumes Awaiting Start of 2020 - 27 December 2019
- Market Awaits China Retaliation on Trade - 29 November 2019
- Alibaba to Close Order Book Ahead of Huge IPO - 18 November 2019