Gold prices edged higher on Friday (Mar 22) and were set for a fourth weekly rise in five after the United States Federal Reserve maintained its interest rate cut projections for the year, boosting investor sentiment.
Spot gold was up 0.1 per cent at US$2,183.93 per ounce, as at 0117 GMT, after hitting an all-time high on Thursday. Bullion has risen 1.3 per cent so far this week.
US gold futures were also up 0.1 per cent at US$2,186 per ounce.
The US central bank held rates steady on Wednesday, but policymakers indicated they still expected to reduce them by three-quarters of a percentage point by the end of 2024 despite recent high inflation readings.
Fed chair Jerome Powell said recent high inflation readings had not changed the overall story of slowly easing US price pressures.
Gold, which pays no interest, tends to benefit when interest rates fall as this reduces the opportunity cost of holding bullion.
Fed funds futures traders are now pricing in a 74 per cent probability that the Fed will begin cutting rates in June, according to the CME Group’s FedWatch Tool.
Meanwhile, the Bank of England kept borrowing costs unchanged on Thursday and said the economy was moving in the direction for interest rate cuts.
Data on Thursday showed that the number of Americans filing new claims for unemployment benefits unexpectedly fell last week, while sales of previously owned homes increased by the most in a year in February.
The US dollar rebounded after the Swiss National Bank’s surprise interest rate cut bolstered global risk sentiment and underscored the appeal of the greenback amid strong US economic growth.
Spot silver was flat at US$24.77 per ounce, platinum slipped 0.3 per cent to US$904.95 and palladium eased 0.1 per cent to US$1,009.21. REUTERS
