The price of gold hovered close to its four-month decline on Tuesday due to a much stronger dollar on the session earlier. The markets are currently anticipating the future movement of interest rate hikes in the stateside from central banks.
The dollar outperformed one of its major peers, the Japanese yen, last Monday. The greenback was also boosted by the release of strong economic figure from Germany. It is already given that a much stronger U.S. dollar is not good with gold because it makes the non-yielding bullion high-priced for non-U.S. holders which will further reduce the demand.
Investors are waiting on U.S, Federal Reserve Chair Janet Yellen’s speech on the Congress this coming Wednesday and Thursday. The New York Federal Reserve reported last Monday that consumers of the yellow metal are expected to strengthen spending in months to come and showed positivity on the possibilities of finding a job and more unlikely to lose one in a robust employment market.
Looking on metal prices, U.S. gold futures advanced as much as 0.3 percent to trade at $1,212.80 an ounce for its August delivery, while spot gold didn’t do well on the day as it dropped more than 0.2 percent to settle at $1,212.01 an ounce after notching a decline of $1204.45.
Two tonnes of gold were traded using the new precious spot contract of the London Metal Exchange. It already started to experience trading in the largest over-the-counter gold market by late afternoon on its very first day.
The biggest gold-backed exchange-traded fund, SPDR Gold Trust, dropped by 0.35 percent to 832.39 tonnes last Monday, lower compared to last Friday’s 835.35 tonnes.