PRECIOUS-Gold hits over one-week high as dollar eases, Fed minutes on radar

Credit: REUTERS/ATHIT PERAWONGMETHA

By Anushree Ashish Mukherjee

Feb 20 (Reuters) - Gold prices climbed to their highest level in more than a week on Tuesday as the dollar retreated, while the spotlight shifted to the release of the U.S. Federal Reserve's latest monetary policy meeting minutes for further interest rate cut cues.

Spot gold XAU= was up 0.6% at $2,028.79 per ounce as of 9:37 a.m. ET (1437 GMT). U.S. gold futures GCcv1 rose 0.8% at $2,040.00 per ounce.

The dollar index .DXY was down 0.4%, making greenback-priced bullion less expensive for overseas buyers. USD/

The minutes from the U.S. central bank's January policy meeting are due on Wednesday.

"We continue to see the likelihood that the Fed will lower rates by mid 2024," which is going to be an underlying supportive factor for thegold market" said David Meger, director of metals trading at High Ridge Futures.

But, the Fed minutes will reiterate that rate cuts are going to be pushed back until May or June, which is certainly not going to help thegold market Meger said, adding there is fundamental support below the $2,000 level.

Lower interest rates boost the appeal of non-yielding gold.

Hotter-than-expected U.S. consumer prices and producer prices data last week reduced hopes for a rate cut in March. Markets are currently pricing a 77% chance of a cut in June, according to the CME Fed Watch Tool.

"Strong physical market buying activity has kept (gold) prices from weakening," analysts at TD Securities wrote in a note.

"At a certain price, silver will always make its way to market, but the outlook for physical demand suggests that higher prices will be necessary to satisfy the ongoing period of structural deficits."

Spot silver XAG= was up 0.5% to $23.12 per ounce.

Spot platinum XPT= gained 1.1% to $907.99 per ounce and palladium XPD= rose 2.4% at $976.46.

(Reporting by Anushree Mukherjee in Bengaluru; Editing by Sharon Singleton)

((anushree.ashishMukherjee@thomsonreuters.com;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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