Gold off 11-week highs after Fed signals more US rate hikes … RTRS
Gold off 11-week highs after Fed signals more US rate hikes
* Gold snaps 4-session gaining streak
* Syria crisis, U.S.-China trade spat underpin gold prices
* Silver off near 2-month highs
Gold eased off multi-weekhighs on Thursday as minutes from the Federal Reserve’s las tpolicy meeting raised expectations of a faster pace of U.S. rate hikes, but concerns
about possible U.S. military action against Syria limited losses.
After rising for four previous sessions, spot gold was down 0.2 percent at $1,350.70 an ounce as of 0319 GMT and U.S. gold futures fell 0.4 percent to $1,354.5 an ounce.
All of the Federal Reserve’s policymakers felt that the U.S.economy would firm further and that inflation would rise in the coming months, minutes of the central bank’s last policy meetingon March 20-21 released
on Wednesday showed.
Higher interest rates discourage the buying of non-interest-paying bullion, which is priced in dollars.
Gold on Wednesday rose 1 percent and hit a high of $1,365.23 an ounce, its highest since Jan. 25.
“While we expect volatility to remain high, gold will stay supported so as long as U.S. military option remains on the table, gold will continue bid,” said Stephen Innes, head of trading in Asia-Pacific for OANDA
“But we could see prices rocket higher if both the United States and Israel get drawn into the fracas siding with Saud iArabia in Riyadh escalations with Tehran.
A test of $1,400+ would be on the cards immediately.”
U.S. President Donald Trump warned Russia on Wednesday of imminent military action in Syria over a suspected poison gas attack, declaring that missiles “will be coming” and lambasting Moscow for standing by Syrian
President Bashar al-Assad.
Gold is often used as a store of value during times of financial or political uncertainty.
Also under pinning bullion were lingering worries about a trade war between China and the United States.
China will not hesitate to fight back if the United States escalates its trade spat with Beijing, the commerce ministry said on Thursday, asserting that Chinese President Xi Jinping’s pledge to cut import tariffs
is not a concession to Washington.
Among other precious metals, silver was steady at $16.63 an ounce, after hitting $16.87 in the previous session, a near two-month high.
Platinum gained 0.3 percent to $929 per ounce and palladium fell 0.5 percent to $959.72 per ounce.
Palladium has surged 6 percent this week on the back of concerns that supply from number one producer Russia could be hurt by sanctions imposed by the United States.