PT Rifan Financindo Berjangka – Gold Steady as Fed Rate Path, Geopolitical Tensions Ease
Gold was steady amid thin trading due to the U.S. Thanksgiving holiday, with investors weighing the prospect of a Federal Reserve interest rate cut and rising tensions in Ukraine.
Bullion was trading near $2,640 an ounce on Friday and down about 3% for the week after a ceasefire between Israel and Hezbollah reduced some demand for the safe-haven asset. Swap markets are pricing in a more than 60% chance the Fed will ease borrowing costs again next month
The market is also monitoring fresh threats from Russia, after President Vladimir Putin warned on Thursday that his forces could strike “decision-making centers” in Kyiv with new ballistic missiles, further escalating the war in Ukraine.
The precious metal is still up nearly 30% this year, though the rally has reversed this month after Donald Trump’s election victory boosted the dollar, making bullion more expensive for many buyers. The U.S. currency gauge is on track for its first weekly decline in eight weeks, however, potentially positive for bullion if losses persist.
Spot gold was little changed at $2,637.32 an ounce at 8:17 a.m. in Singapore. The Bloomberg Dollar Spot Index fell 0.1 percent, and is down 1 percent this week. Silver was steady, while platinum and palladium were slightly lower. Source: Bloomberg
Gold Edges Higher as Traders Weigh Inflation Data, Ukraine War
Gold edged higher as investors assess Russia’s threats of ballistic missile strikes on the Ukrainian capital and the outlook for US interest rates.
Bullion climbed 0.2% to $2,641.54 an ounce as of 12:44 p.m. in New York.
Russian President Vladimir Putin warned on Thursday that Russian forces could strike “decision-making centers” in Kyiv with new ballistic missiles, threatening to further escalate the war in Ukraine. Geopolitical tensions boost gold’s appeal as a haven asset. Still, the bullion market has been relatively calm since Monday’s 3.4% slump, which came on news that Israel and Lebanese militant group Hezbollah were preparing a 60-day suspension of hostilities.
Meanwhile, investors are digesting the next moves by the Federal Reserve and its impact on gold. The case for a December interest-rate cut was bolstered by Wednesday’s US core personal consumption expenditures price index, the Fed’s preferred measure of underlying inflation, which increased in line with expectations. Traders are now pricing in a two-thirds chance of a quarter-point cut next month, up from about even odds earlier this week. Lower borrowing costs typically benefit gold, as it doesn’t pay interest.
Pressure on gold prices eased this week as a dollar rally sparked by President-elect Donald Trump’s re-election lost steam. A stronger dollar makes the precious metal more expensive for many buyers. The Bloomberg Dollar Spot Index was little changed. Silver, platinum and palladium rose. PT Rifan Financindo Berjangka.
Source: Bloomberg