New York, US (BBN) – Gold prices dipped in Asia on Tuesday as investors looked anew at hte prospect of the Fed hiking interest rates next month as market talk raises speculation on a move.
Gold for April delivery on the Comex division of the New York Mercantile Exchange slipped 0.41 per cent to $1,253.65 a troy ounce, reports
Copper futures gained 0.04 per cent to $2.696 as labor and regulator problems at key mines in Chile and Indonesia respectively have lasted several weeks without progress on resolution.
According to’s Fed Rate Monitor Tool 33 per cent of traders expect the Fed to raise interest rates at its next meeting in March compared to only 26 per cent of traders a day earlier.
Overnight, gold futures retreated from 3.5 month highs but ultimately traded higher on Monday, as investors await President Trump’s outline on his economic agenda, which includes tax reforms, infrastructure spending and foreign policy.
Gold futures made strong gains in early morning trade, as jitters concerning President Trump’s address to congress on Tuesday weighed on the dollar, while continued uncertainty ahead of the elections in the Netherlands, France and Germany drew support for the yellow-metal’s ‘safe haven’ status.
The yellow-metal struggled to hold onto gains during US trading hours, after a better-than-expected durable goods order print for January and Dallas Fed President Robert Kaplan dovish speech lifted the dollar from session lows.
The Commerce Department said on Monday that orders for durable goods rose 1.8 per cent in January after two months of declines.
Dallas Fed President Robert Kaplan speech in Oklahoma on Monday had little impact on the dollar, after he reiterated that the rate hike should be sooner than later and said that even if the Fed raised interest rates “a few times” in 2017 the economy would likely grow more than 2 per cent this year.
Gold is sensitive to moves in US rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced.