Gold holds ground as investors await US data for further clues
Tue Oct 01 2024
Gold price held its ground on Tuesday, following a decline of nearly 1% in the previous session, as investors awaited upcoming U.S. data for insights on potential interest rate cuts this year.
* Spot gold was steady at $2,635.89 per ounce, as of 0006 GMT. Bullion hit a record high level of $2,685.42 on Thursday.
* U.S. gold futures edged 0.1% lower to $2,657.50.
* Federal Reserve Chair Jerome Powell said on Monday he sees two more interest rate cuts, totaling 50 basis points, this year as a baseline "if the economy performs as expected," though the Fed could cut faster, or slower, if needed.
* Traders on Monday favored a quarter-point interest rate cut in November over another half-point cut, following Fed Chair Jerome Powell's remarks that rates will reach a neutral level "over time".
* Meanwhile, Chicago Federal Reserve President Austan Goolsbee reiterated on Monday that he supports significant interest rate cuts based on the current economic conditions and their expected trajectory.
* Lower interest rates reduce the opportunity cost of holding bullion, which is also viewed as a safe asset during economic and political turmoil.
* On the geopolitical level, Israel's anticipated ground invasion of Lebanon began early Tuesday, with its military reporting "limited" raids on Hezbollah targets near the border.
* The market will be closely watching U.S. job openings data later today, as well as remarks from various Fed officials, for more hints.
* Goldman Sachs raised its gold price forecast for early 2025 to $2,900 per ounce, up from $2,700, citing increasing ETF flows due to interest rate cuts in the West and China, as well as higher central bank purchases.
* Spot silver was up 0.2% to $31.22 per ounce, platinum gained 0.5% to $980.80 and palladium was flat at $999.32.
Source: http://in.reuters.com