Demand for gold in Asia is surging despite prices hovering near the record highs it hit in May
12 June 2024 - 07:36
bySherin Elizabeth Varghese
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Bengaluru — Gold prices were flat on Wednesday as investors awaited the US Federal Reserve’s policy announcement for insights into how soon it will cut interest rates in 2024 and the May inflation report due later in the day.
Spot gold was almost unchanged at $2,314.89/oz, as of 3.11am GMT. US gold futures rose 0.2% to $2,331.40/oz.
“Gold prices have been treading lightly amid the waiting game for greater cues on the Fed’s policy path. Any lean towards two rate cuts could be perceived as a more dovish take, which may see gold prices head higher,” said IG market strategist Yeap Jun Rong.
Investors will assess the inflation situation when US consumer price index numbers are released at 12.30am GMT, just hours before the Fed concludes its two-day policy meeting.
The market is divided on whether the Fed would cut rates once or twice in 2024 after the recent strong US labour report, so the attention will be on policymakers6 updated economic projections and chair Jerome Powell’s media conference.
Strong US jobs data and reports of China’s central bank holding off gold purchases triggered bullion’s biggest daily drop since November 2020 last week.
“While China did take a break from gold in May, I don’t believe that the People’s Bank of China are finished with their diversification efforts away from the dollar,” Tim Waterer, chief market analyst at KCM Trade, said in a note.
“So it may just be a case that they will be more of a ‘selective buyer’ of gold moving forward.”
Demand for gold in Asia is surging despite prices hovering near the record highs it hit in May, industry officials said.
In other metals, spot silver rose 0.6% to $29.46/oz, platinum was up 0.7% at $958.02 and palladium gained 1.3% to $895.35.
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Gold holds steady ahead of US Fed moves
Demand for gold in Asia is surging despite prices hovering near the record highs it hit in May
Bengaluru — Gold prices were flat on Wednesday as investors awaited the US Federal Reserve’s policy announcement for insights into how soon it will cut interest rates in 2024 and the May inflation report due later in the day.
Spot gold was almost unchanged at $2,314.89/oz, as of 3.11am GMT. US gold futures rose 0.2% to $2,331.40/oz.
“Gold prices have been treading lightly amid the waiting game for greater cues on the Fed’s policy path. Any lean towards two rate cuts could be perceived as a more dovish take, which may see gold prices head higher,” said IG market strategist Yeap Jun Rong.
Investors will assess the inflation situation when US consumer price index numbers are released at 12.30am GMT, just hours before the Fed concludes its two-day policy meeting.
The market is divided on whether the Fed would cut rates once or twice in 2024 after the recent strong US labour report, so the attention will be on policymakers6 updated economic projections and chair Jerome Powell’s media conference.
Strong US jobs data and reports of China’s central bank holding off gold purchases triggered bullion’s biggest daily drop since November 2020 last week.
“While China did take a break from gold in May, I don’t believe that the People’s Bank of China are finished with their diversification efforts away from the dollar,” Tim Waterer, chief market analyst at KCM Trade, said in a note.
“So it may just be a case that they will be more of a ‘selective buyer’ of gold moving forward.”
Demand for gold in Asia is surging despite prices hovering near the record highs it hit in May, industry officials said.
In other metals, spot silver rose 0.6% to $29.46/oz, platinum was up 0.7% at $958.02 and palladium gained 1.3% to $895.35.
Reuters
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