Gold Rises to More Than 3-week High

Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. REUTERS/Arnd Wiegmann/File Photo
Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. REUTERS/Arnd Wiegmann/File Photo
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Gold Rises to More Than 3-week High

Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. REUTERS/Arnd Wiegmann/File Photo
Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. REUTERS/Arnd Wiegmann/File Photo

Gold prices climbed on Thursday to highest in more than 3 weeks as the US dollar and bond yields hit multi-month lows on mounting bets the Federal Reserve will start cutting interest rates as soon as next March.

Spot gold was up 0.5% at $2,086.69 per ounce, as of 0406 GMT, hitting its highest since Dec. 4, when prices raced to a record high of $2,135.40. It looked set to mark its best year in three with a 14% gain.
US gold futures rose 0.2% to $2,096.50 per ounce.
Lower yields and dollar indicate diminished risk around interest rate volatility "and have given gold that extra drive towards $2100 per ounce level," Kyle Rodda, a financial market analyst at Capital.com, said.
Bets on Fed cutting interest rates firmed following cooler inflation data, with traders now indicating an 88% likelihood of monetary policy easing in March, according to the CME FedWatch tool.
Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
Increasing gold's appeal, the dollar index slipped to a five-month low and was set for its worst yearly performance since 2020, while benchmark US 10-year bond yields languished near their lowest level since July.
Going into 2024, gold's movement "depends on whether the markets have gone too ahead of themselves while pricing in rate cuts, and whether recessionary conditions start to emerge in the US," Reuters quoted Rodda as saying.
Market participants now await US initial jobless claims data due at 1330 GMT for further cues on monetary policy.
Spot silver rose 0.7% to $24.42 per ounce and was poised to end the year with a near 2% annual gain.
Platinum rose 0.2% to hit a more than six-month high of $999.00. Palladium rose 0.2% to $1,156.16, but was on track for its biggest yearly decline since 2008.



Dollar Hobbled by Economic Worries; Euro Remains in Favor

US dollar drifted within a tight range on Monday, pressured by lower Treasury yields - Reuters
US dollar drifted within a tight range on Monday, pressured by lower Treasury yields - Reuters
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Dollar Hobbled by Economic Worries; Euro Remains in Favor

US dollar drifted within a tight range on Monday, pressured by lower Treasury yields - Reuters
US dollar drifted within a tight range on Monday, pressured by lower Treasury yields - Reuters

The dollar hovered near a five-month low against major peers on Monday, bruised by President Donald Trump's erratic trade policies and soft economic data, at a time when other currencies, including the euro, benefit from domestic drivers.

The euro was last at $1.0905, up 0.2% on the day, and heading back towards the $1.0947 it hit last week, its highest since October 11.

The Japanese yen was also marginally stronger on the day at 148.48 per dollar, again after hitting its strongest in five months last week at 146.5 to the dollar.

That left the dollar index, which measures the US currency against its six major counterparts, at 103.5, just off its five-month trough of 103.21 reached last Tuesday, Reuters reported.

Currency markets have undergone a shift in recent months, as traders re-evaluate their initial expectations that Trump's economic policies would both support the dollar and cause other currencies to weaken.

In fact the reverse has happened, and analysts at Societe Generale said on Monday that they had changed their currency forecasts "to reflect Germany's planned fiscal changes, the US economy's self-inflicted (relative) fragility, and Japan’s escape from deflation".

They see the euro at $1.13 by year-end and the yen at 139 per dollar.