Gold Prices Surge Amid Weakening Dollar and Easing Oil
Gold prices rose over 1% on Wednesday as investors awaited the US Federal Reserve's decision on interest rates. Spot gold was up 1.3% at $4,347.91 per ounce after touching a more than one-month low on Monday.
The dollar weakened and oil prices slipped, making dollar-denominated metals cheaper for buyers holding other currencies. 'Gold firms up today on easing dollar strength, a cooldown in oil prices and a pullback in US bond yields,' said Nikos Tzabouras, a senior market analyst at Jefferies-owned Tradu.com.
Traders are pricing in a 93% chance of at least a 25-basis-point US rate hike. Higher rates increase the opportunity cost of holding non-yielding bullion. 'As long as supply disruptions keep crude and consumer prices elevated, pressure for monetary tightening will persist, weighing on bullion,' said Tzabouras.
Among other metals, spot silver rose 1.8% to $64.78 per ounce, platinum edged 0.6% higher to $1,787.01, and palladium gained 1.8% to $1,313.12.