Bengaluru — Gold rose on Wednesday, reversing earlier
losses, as the US dollar edged slightly lower from 14-year highs touched
the previous day.
Spot gold was up 0.2% at $1,134.26/oz by 2.52am GMT. It fell 0.6% in the previous session.
US gold futures were 0.2% higher at $1,135.80/oz.
"Light trading volume can leave gold and the other precious metals open to wide swings and erratic behaviour on relatively little buying or selling," HSBC analyst James Steel said in a note.
"Any pullback in the greenback may trigger a scramble into gold."
The dollar index, which measures the greenback against a basket of currencies, was down 0.2% at 103.110. The index touched 103.65 on Tuesday, its highest since December 2002.
"The steep dollar continues to pressure commodities, including precious metals, especially gold. The precious metal faces a further downward pressure as it yields no interest in a world of likely rising interest rates and bond yields," said Mihir Kapadia, CEO of London-based Sun Global Investments.
"We expect this trend to continue for the next few months."
The Federal Reserve hiked rates for the first time in a year last week and projected three more increases in 2017, up from the two projected in September. Gold is highly sensitive to rising rates, which lift the opportunity cost of holding nonyielding assets such as bullion, while boosting the dollar, in which it is priced.
Signals were mixed for spot gold as it approached a support at $1,121/oz again, Reuters commodities technicals analyst Wang Tao said. "Gold may near $1,100/oz, but we do not think the market will go below that level. If it does break $1,100/oz, we would expect bargain hunters and price sensitive buyers to increase purchases," HSBC’s Steel added.
Among other precious metals, silver edged 0.1% lower to $16.07/oz. The metal hit $15.59 in the previous session, its lowest since April 11.
Platinum was down 0.1% at $915.24.
Palladium shed 0.2% to $662.75/oz. It touched a near one-and-a-half-month low of $660.22 earlier in the session.
Reuters
Spot gold was up 0.2% at $1,134.26/oz by 2.52am GMT. It fell 0.6% in the previous session.
US gold futures were 0.2% higher at $1,135.80/oz.
"Light trading volume can leave gold and the other precious metals open to wide swings and erratic behaviour on relatively little buying or selling," HSBC analyst James Steel said in a note.
"Any pullback in the greenback may trigger a scramble into gold."
The dollar index, which measures the greenback against a basket of currencies, was down 0.2% at 103.110. The index touched 103.65 on Tuesday, its highest since December 2002.
"The steep dollar continues to pressure commodities, including precious metals, especially gold. The precious metal faces a further downward pressure as it yields no interest in a world of likely rising interest rates and bond yields," said Mihir Kapadia, CEO of London-based Sun Global Investments.
"We expect this trend to continue for the next few months."
The Federal Reserve hiked rates for the first time in a year last week and projected three more increases in 2017, up from the two projected in September. Gold is highly sensitive to rising rates, which lift the opportunity cost of holding nonyielding assets such as bullion, while boosting the dollar, in which it is priced.
Signals were mixed for spot gold as it approached a support at $1,121/oz again, Reuters commodities technicals analyst Wang Tao said. "Gold may near $1,100/oz, but we do not think the market will go below that level. If it does break $1,100/oz, we would expect bargain hunters and price sensitive buyers to increase purchases," HSBC’s Steel added.
Among other precious metals, silver edged 0.1% lower to $16.07/oz. The metal hit $15.59 in the previous session, its lowest since April 11.
Platinum was down 0.1% at $915.24.
Palladium shed 0.2% to $662.75/oz. It touched a near one-and-a-half-month low of $660.22 earlier in the session.
Reuters
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