Anasayfa Blog Daily News Gold remains below $1,700

Gold remains below $1,700

by AgaBullion
Gold remains below $1,700

Gold stayed below $1,700 an ounce as worse-than-expected inflation data out of the US this week increased expectations of a prolonged period of interest rate rises.

Bullion fell 0.3% on Wednesday following the US government's inflation figures report, while a measure for US producer prices also concerned market watchers. After a sharp spike on Tuesday, the dollar dipped in the next session.

Investors are now fully pricing in a 75 basis point rate hike when the Federal Reserve board meets next week. Some are even predicting a full percentage point increase, although that prospect was downplayed by JPMorgan Chase & Co. chief US economist Michael Feroli.

European Central Bank Governing Council member Robert Holzmann warned inflation was "likely to accelerate even more," which could result in robust monetary-policy tightening there. Higher rates tend to weigh on non-interest bearing bullion.

Meanwhile, in China growth has slowed so sharply that several major banks don't even think a 3% expansion is achievable this year. That could impact gold jewelry demand in the world's biggest consumer of the precious metal.

Spot gold was little changed at $1,695.45 an ounce at 8:58 a.m. in Singapore. The Bloomberg Dollar Spot Index was also flat. Silver and palladium were steady, while platinum was down.

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