Image: Bloomberg
Bengaluru — Gold prices rose on Tuesday after two sessions of losses as the dollar eased, while investors sought more clarity on the US Federal Reserve’s monetary policy stance.
Spot gold was up 0.3% at $2,001.09 an ounce at 3.10am GMT. US gold futures rose 0.3% to $2,012.40.
“Given the sharp moves of late and little tier-1 economic data to guide this week, we should expect gold to consolidate in the $1,980-$2,020 range,” OCBC FX strategist Christopher Wong said.
The US dollar index was 0.1% lower and made bullion cheaper for overseas buyers.
Gold prices fell to an about two-week low on Monday after data showed manufacturing activity in New York state increased for the first time in five months, and confidence among US single-family home builders improved for a fourth straight month in April. The data added to bets of an interest rate hike by the Fed at its May meeting.
The CME FedWatch tool shows markets are pricing in a 87.1% chance of a 25 basis-point hike in May. Gold is considered a hedge against inflation and economic uncertainties, but higher interest rates dim the non-yielding bullion's appeal.
Focus will now be on comments from Fed officials this week before they enter into a blackout period from April 22 ahead of the central bank’s May 2-3 meeting.
“There is too much earnings, political, geopolitical and central bank risk on the table,” Edward Moya, senior market analyst at Oanda, said in a note, and that only a couple of risks need to rattle markets to trigger safe-haven flows towards gold with the metal’s path towards record territory still present.
Meanwhile, top bullion consumer China’s economic recovery gathered pace in the first quarter as the country’s GDP grew 4.5% year-on-year, beating analyst forecasts.
Spot silver fell 0.2% to $25.06 an ounce, platinum added 0.2% to $1,050.24 and palladium gained 0.6% at $1,569.67.
Reuters