Monitoring Desk
WASHINGTON: Gold edged up for a 3rd session on Wednesday as the US dollar pulled back, although fears of further US interest rate climbs on the back of inflexibly high inflation kept a lid on prices.
Spot gold was up 0.1 percent at 1,829.37 dollars per ounce, as of 0315 GMT. US gold stocks eased 0.1 percent to 1,835.30 dollars.
Gold prices
Matt Simpson, a market analyst at City Index, said that Gold is overvalued in the near term, having found support at its two hundred days exponential moving normal, and the US dollar is due a tieback against February’s gains.
Gold marked its worst month since June 2021 in February following a string of US data pointed to a strong economy and a tight labor market, fueling fears that the US Federal Reserve would bring more interest rate climbs to resolve the issue of inflation.
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High-interest rates reduce gold’s appeal as an inflation hedge while increasing the opportunity cost of holding the non-yielding asset. Currency markets expect the US central bank’s target rate to high at 5.420 percent in September, from a present range of 4.50 percent to 4.75 percent.
Gold prices drop about 8 percent since February 1. The dollar index marked 0.1 percent lower, making gold more reasonable for purchasers holding other currencies.
According to official data, top gold consumer China’s manufacturing activity has extended as the fastest pace in more than a decade in February.
