Gold Gleams as Greenback Falters

24 Jan 2024 , 09:06 AM

With the U.S. currency depreciating, gold prices rose on Tuesday. Investors were also anticipating stronger U.S. economic data this week, which could influence the direction of the Federal Reserve’s policy meeting the following week.

Spot gold was up 0.3% at $2,026.95 an ounce. Moreover, US gold futures increased by 0.3% to $2,028.60.

Other currency holders found the gold offered in US dollars more appealing because the US dollar was down 0.1% compared to a basket of currencies.

Fed policymakers stated last week that the third quarter should be the starting point for rate decreases because the U.S. central bank needs additional inflation data before making any decisions.

This week’s highlights are the U.S. flash PMI report on Wednesday, the advance GDP estimates for the fourth quarter that are coming on Thursday, and the data on personal consumption expenditures on Friday.

According to CME’s FedWatch Tool, markets have reduced the date of the first interest rate cut and generally anticipate that the Fed will keep rates steady at the conclusion of its policy meeting on January 30-31.

At its meeting on Thursday, the European Central Bank (ECB) is anticipated to maintain its current monetary policy. Holding bullion has a lower opportunity cost when interest rates are lower.

Palladium fell 0.2% to $935.13, spot silver increased 0.6% to $22.24 per ounce, while platinum increased 1% to $900.93.

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