The dollar weakened on Wednesday, while U.S. inflation statistics released the previous day increased expectations that the Federal Reserve will continue to tighten monetary policy. Gold prices also increased a little on the day.
Spot gold was up 0.1% at $1,856.47 per ounce. The price of U.S. gold futures was unchanged at $1,865.80.
Gold traded in dollars became less expensive for buyers holding other currencies as the dollar index weakened by 0.1%.
According to the Labor Department’s report released on Tuesday, the consumer price index grew by 0.5% last month, as anticipated. The CPI rose 6.4% in the 12 months that ended in January, which was the lowest advance since October 2021 and came after a 6.5% increase in December.
Fed members said that in order to combat inflation, the U.S. central bank would need to keep gradually raising interest rates. They also suggested that higher borrowing costs may result from persistent price pressures brought on by a strong labour market.
Investors are put off from investing in non-yielding assets like gold by rising interest rates.
From its current range of 4.50% to 4.75%, the money markets now anticipate that the Fed’s target rate will top at 5.257% in July.
In an interview with the Wall Street Journal, Gabriel Makhlouf, a member of the European Central Bank’s governing council, stated that the bank could raise interest rates over 3.5% and is unlikely to do so this year.
Platinum increased by 0.3% to $933.05. Spot silver nudged up 0.1% to $21.86 per ounce. After falling to its lowest level since late-August 2019 in the previous session, palladium increased 0.3% to $1,501.08.
For feedback and suggestions, write to us at editorial@iifl.com
Related Tags
Invest wise with Expert advice
IIFL Customer Care Number
(Gold/NCD/NBFC/Insurance/NPS)
1860-267-3000 / 7039-050-000
IIFL Capital Services Support WhatsApp Number
+91 9892691696
IIFL Capital Services Limited - Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213,IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248
ARN NO : 47791 (AMFI Registered Mutual Fund Distributor)
This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.