Gold Prices Rebound as Dollar Weakens and Bond Yields Ease
Gold prices rebounded on Wednesday as the US dollar weakened and global bond yields eased from multi-decade highs. This comes ahead of the release of minutes from the Federal Reserve's latest policy meeting, which will provide guidance on interest rates amid persistent inflation risks.
The spot price of gold gained 0.5% to $4,356.29 an ounce by 0908 GMT, while US gold futures slipped 0.2% to $4,410.30. The dollar softened as the bond selloff slowed on Wednesday, improving appetite for non-interest-bearing bullion.
Nikos Tzabouras, senior market analyst at Jefferies-owned Tradu.com, said 'In the near term, bullion may struggle for a clear trajectory, pulled in competing directions as markets weigh lingering geopolitical friction against the Fed's evolving policy path.' However, he added that 'the macro backdrop is gradually improving for bullion as price pressures ease and the case for a Fed hold strengthens.'
Gold has risen almost 10% this month, with UBS analysts predicting higher prices ahead over the medium term as real U.S. interest rates fall and investment demand remains high.