PT Rifan Financindo Berjangka – Gold Holds Above Gains Ahead of US Data
Gold steadied after a rally as traders shifted focus to a key US inflation report due later this week that could shape expectations ahead of the Federal Reserve’s final interest rate decision of the year.
Bullion prices held near $2,660 an ounce — near a two-week high — after China’s central bank added the precious metal to its reserves for the first time in seven months.
Geopolitical concerns also fueled demand for safe-haven assets amid fears of a power vacuum in Syria after Bashar al-Assad was ousted from power over the weekend.
Data on Wednesday and Thursday will give Fed officials a final look at the inflation environment ahead of their policy meeting next week
Any sign that progress has stalled in reining in rising prices could dampen the chances of a cut, although swap markets are pricing in an 86% chance of a 25-point decline. Higher borrowing costs are typically negative for bullion, as it does not pay interest.
Gold surged to an all-time high above $2,790 an ounce in October, supported by monetary easing by the Fed and rising demand for safe-haven assets amid rising tensions in the Middle East and Ukraine.
Gold prices have eased since the dollar strengthened following Donald Trump’s victory in the U.S. election, but remain 28% higher this year.
Spot gold was flat at $2,659.71 an ounce at 8:20 a.m. in Singapore, following a 1% gain on Monday. The Bloomberg Dollar Spot Index was little changed. Silver and palladium edged up, while platinum was steady.
Source: Bloomberg
Gold Hits 2-Week High on China Buying, Fed Rate Cut Expectations
Gold prices hit two-week highs on Monday, climbing more than 1% on renewed buying of the metal by China’s central bank following a six-month hiatus, with bullishness increased by anticipation of a U.S. Federal Reserve interest rate cut next week.
Spot gold gained 1.1% to $2,662.98 per ounce, as of 01:41 p.m. ET (1841 GMT). U.S. gold futures settled 1% higher at $2,685.50.
“The most important factor is news that People’s Bank of China reported that it again resumed its gold purchases … the market is getting hopeful that we could see other central banks follow suit and we could see a resumption of record territory buying,” said Bart Melek, head of commodity strategies at TD Securities.
The resumption of Chinese buying may support investor demand in the country. In 2023, China was the world’s largest official sector buyer of gold, but the PBOC paused its 18-month buying streak in May.
Robust central bank buying has played a major part in supporting gold’s record rally this year, alongside monetary policy easing and geopolitical tensions.
The U.S. Fed started its interest rate easing cycle with an unusually large 50 basis point cut in September, followed by a 25bp cut in November. Traders are pricing an 86% chance of another quarter-percentage-point rate cut from the central bank at its Dec. 17-18 meeting. PT Rifan Financindo Berjangka.
Source : Reuters