The market weighs the prospect of a US interest rate hike, and gold prices are trending stable.
Huitong Finance APP News - Gold prices fell slightly amid the weighing of the Federal Reserve's interest rate hike prospects, with the dollar remaining strong despite investor anticipation of inflation data later this week. As of press time, spot gold prices fell 0.45% to $1,916.62 an ounce. Gold prices failed to hold above $1,930 an ounce last week and entered a sideways trading phase. Carlo Alberto De Casa, market analyst at Kinesis Money, said that if the Fed raises interest rates, gold could face further pressure, approaching the key psychological support level of $1,900 an ounce. Higher interest rates will curb purchases of non-interest-bearing gold, while gold prices are denominated in US dollars. Last week, Federal Reserve officials warned that further interest rate hikes may be needed even after last week's decision to keep the benchmark rate unchanged, with three policymakers saying they remain uncertain whether the inflation battle is over. The dollar hovered near a six-month high, while the benchmark 10-year Treasury yield neared its highest level in 16 years. Investors are now focusing on the Personal Consumption Expenditures Price Index (PCE), the Fed's preferred inflation gauge, which is scheduled to be released on September 29. The world's largest gold-backed ETF, SPDR Gold Trust, said its holdings fell to their lowest level since January 2020 on Friday. This also reflects investor sentiment. UBS said in a report, "Reduced Chinese palladium imports may be another factor affecting prices, while the automotive indicator continues to shift from palladium to platinum as a catalyst." They added that total demand accounts for about 90%, and apart from moderate industrial, jewelry and investment demand, the lack of other alternative industries makes this precious metal very sensitive to data such as the growth of electric vehicles and the phasing out of internal combustion engine vehicles in Europe.
Time:
2023-09-26 07:59
Huitong Finance APP News - Gold prices fell slightly amid the weighing of the Federal Reserve's interest rate hike prospects, with the dollar remaining strong despite investor anticipation of inflation data later this week. As of press time, spot gold prices fell 0.45% to $1,916.62 an ounce.
Gold failed to hold above $1,930 an ounce last week and entered a sideways trading phase. Carlo Alberto De Casa, market analyst at Kinesis Money, said that if the Fed raises interest rates, gold could face further pressure, approaching the key psychological support level of $1,900 an ounce.
Higher interest rates would curb purchases of non-interest-bearing gold, while gold prices are denominated in US dollars.
Last week, Federal Reserve officials warned of further interest rate hikes, even after last week's decision to keep the benchmark rate unchanged, with three policymakers saying they remain uncertain whether the inflation battle is over.
The dollar hovered near a six-month high, while the benchmark 10-year Treasury yield neared its highest level in 16 years.
Investors are now focusing on the Personal Consumption Expenditures Price Index (PCE), the Fed's preferred inflation gauge, which is scheduled for release on September 29.
The world's largest gold-backed ETF, SPDR Gold Trust, said its holdings fell to their lowest level since January 2020 on Friday. This also reflects investor sentiment.
UBS said in a report, "Reduced Chinese palladium imports may be another factor affecting prices, while the substitution of palladium for platinum as a catalyst in automotive indicators continues." They added that total demand accounts for about 90%, and apart from moderate industrial, jewelry and investment demand, the lack of other alternative industries makes this precious metal very sensitive to data such as the growth of electric vehicles and the phasing out of internal combustion engine vehicles in Europe.
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Although gold prices rose this week, market volatility has clearly increased. While the US-UK agreement is symbolic, its content is limited and insufficient to alleviate concerns about a global economic slowdown. Therefore, gold prices will continue to fluctuate between safe havens and policy signals, closely monitoring the Federal Reserve's interest rate expectations and global trade sentiment.