GOLD prices held above the US$2,500 mark on Tuesday (Aug 20), buoyed by a weaker US dollar and Treasury yields, while traders awaited minutes of the Federal Reserve’s last policy meeting for further cues on interest rate cuts.
Spot gold edged 0.1 per cent higher to US$2,505.92 per ounce by 0038 GMT. Prices had hit an all-time high of US$2,509.65 on Friday.
US gold futures rose 0.1 per cent to US$2,543.90.
The US dollar fell to a seven-month low in the previous session, making gold more appealing for the overseas buyers. Benchmark 10-year Treasury yields also slipped.
The Fed is expected to cut rates by 25 basis points at each of the three remaining 2024 meetings, with a slim majority of Reuters-polled economists dismissing recession concerns.
Traders are currently pricing in about a 75.5 per cent chance of a 25 bps cut, according to CME FedWatch tool. A low interest rate environment tends to boost non-yielding bullion’s appeal.
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Minneapolis Fed president Neel Kashkari said it was appropriate to discuss potentially cutting US rates in September because of the rising possibility of a weakening labour market, The Wall Street Journal reported on Monday.
The market is now looking ahead to the minutes of the Fed’s July policy meeting due on Wednesday, and chair Jerome Powell’s speech on the US economic outlook this Friday at the Jackson Hole symposium for further cues.
On the geopolitical front, US Secretary of State Antony Blinken on Monday said the latest diplomatic push by Washington to achieve a ceasefire deal in Gaza was “probably the best, maybe the last opportunity” and implored all stakeholders to get the agreement over the finish line.
Spot silver fell 0.3 per cent to US$29.39 per ounce, platinum gained 0.3 per cent to US$956.41 and palladium shed 0.2 per cent to US$930.25. REUTERS
