By Swati Verma
BENGALURU (Reuters) - Gold prices rose to a two-week high on Wednesday as the dollar slipped, with uncertainty on the pace of rate hikes by the U.S. Federal Reserve also supporting the metal.
Spot gold rose 0.5 percent to $1,227.45 per ounce by 11:55 a.m EST (1655 GMT), having hit its highest since Nov. 7 at $1,230.07 in light trading ahead of the Thanksgiving holiday.
U.S. gold futures rose 0.5 percent to $1,227.50 per ounce.
The dollar has been under pressure this week as cautious comments by Fed officials about a potential global slowdown raised doubts on the pace of rate hikes.
The doubts were compounded by data showing weekly jobless claims rose to a more than four-month high and new orders for U.S.-made capital goods were unexpectedly flat in October. [USD/]
"With the recent volatility in the equity markets and a miss in U.S. data, a lot of investors are questioning and wondering if the Fed is going to continue its hawkish path after the December meeting, and that is supporting gold," said Bob Haberkorn, senior market strategist at RJO Futures.
A weaker dollar makes bullion cheaper for holders of other currencies. The yellow metal's correlation against the dollar index touched negative 0.690, a level last seen two months back.
"Gold is being supported at present largely by short-term technically driven investment demand for futures and physical metal," said Jeffrey Christian, managing partner of CPM Group.
"Gold likely to trade between $1,180 - $1,200 on the low end and $1,240 - $1,250 on the high end for the rest of the year."
Gains in the metal were, however, capped by a bounce in equity markets following a selloff. [MKTS/GLOB]
Market participants are now focused on the G20 summit in Argentina later this month, when U.S. President Donald Trump is expected to meet Chinese President Xi Jinping to discuss their trade dispute.
"With macroeconomic risk now being supplemented by concerns over systemic financial risk, we expect portfolio allocation towards gold to edge higher towards year end," analysts at BMO Capital Markets said in a note.
Among other precious metals, silver climbed 1.5 percent to $14.52 an ounce. It hit its highest since Nov. 8 at $14.55 in the previous session.
Palladium gained 1.4 percent to $1,156.50 per ounce, while platinum was up 0.4 percent at $841.50 per ounce.
(Reporting by Swati Verma in Bengaluru; Editing by Toby Davis)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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Updated Date: Nov 22, 2018 00:05:26 IST