The price of gold was edged up on Monday’s opening session after the U.S. dollar hovered near to an almost two-month low last week. Global investors are currently observing the watchful view of FEd regarding inflation.
Investors are currently anticipating the Congressional hearing on the U.S. Federal Reserve chair nominee Jerome Powell this coming Tuesday. Minutes from the previous Fed meeting suggested that some policymakers have opened up their concerns regarding the future inflation of the United States. It also gave clearance if they will be anticipating upcoming economic figures before inciting interest rate hikes.
Gold prices are fragile to rate hikes because it will heighten the opportunity cost of owning the bullion, which is non-yielding. This will then boost the dollar and will make the yellow metal high priced for holders outside the United States.
Looking at the current price of gold, U.S. gold futures rose more than 0.2 percent to settle at $1,289.90 an ounce for its December delivery. Meanwhile, spot gold added 0.2 percent to finish at $1,290 per ounce.
Hong Kong’s Wing Fung Financial Group’s head of research Mark To said that the inverse relationship between the price of gold and the U.S. dollar is in effect as of today. He added that that kind of strong relationship is still unlikely because movement will still be range bound while prices are rising.
In other precious metals: palladium slipped by 0.2 percent at $995.70 per ounce, platinum also lost 0.2 percent at $938.05 per ounce and spot silver jumped by 0.4 percent at $17.05 per ounce.