Gold soars to over seven-month high as dollar falls ahead of Fed meet
By Arijit Bose (Reuters) - Gold jumped over 1 percent to a more than seven-month high on Friday, briefly surpassing the $1,300 mark, as the dollar slid ahead of a U.S. Federal Reserve meeting next week where the central bank is widely expected to leave interest rates unchanged.
By Arijit Bose
(Reuters) - Gold jumped over 1 percent to a more than seven-month high on Friday, briefly surpassing the $1,300 mark, as the dollar slid ahead of a U.S. Federal Reserve meeting next week where the central bank is widely expected to leave interest rates unchanged.
Spot gold rose 1.4 percent to $1,298.93 per ounce as of 11:41 am ET (1641 GMT), having earlier touched a peak of $1,300.30, its highest since June 15, 2018. The metal was on course for its best week in four.
U.S. gold futures climbed 1.5 percent to $1,298.30 per ounce.
"The major catalyst supporting gold is a big drop in the dollar, amid expectations the Fed will reiterate a pause to its hiking cycle next week," said Fawad Razaqzada, an analyst with Forex.com.
Gold tends to appreciate on expectations of lower interest rates, which reduce the opportunity cost of holding non-yielding bullion.
The dollar fell off a three-week high it scaled in the previous session, as investors turned their attention to the Fed meeting next week. This made gold, which is traded in dollars, cheaper for holders of other currencies. [USD/]
"There are also some rumours that the Fed is backing off their quantitative tightening program, which would mean they are going dovish. This would in turn mean a probable end of rate hikes in 2019, which would be supportive for gold," said Bob Haberkorn, senior market strategist at RJO Futures.
Investor sentiment toward gold has been considerably ripe with holdings of SPDR Gold, the largest gold-based Exchange Traded Fund, hovering around their highest levels since late June 2018. [GOL/ETF]
Risks "from economic and political perspectives, are keeping gold relatively well supported going forward," said Commerzbank analyst Daniel Briesemann.
A synchronised global economic slowdown is underway and any escalation in the U.S.-China trade war would trigger a sharper downturn, according to the latest Reuters polls of hundreds of economists from around the world.
Investors are also worried about the impact of the longest U.S. government shutdown in history, with two bills to end the partial shutdown failing to win enough votes in the Senate.
Yet another key focus is U.S.-China trade relations. U.S. Commerce Secretary Wilbur Ross said on Thursday the two countries were "miles and miles" from resolving issues.
Among other metals, palladium, which hit a record high of $1,434.50 an ounce last week on low inventories and rising demand, gained 2.9 percent to $1,358 but remained on course for its first weekly drop in five after falling over 1 percent so far this week.
Silver rose 2.3 percent to $15.67 per ounce, while platinum gained 1.8 percent to $815.50, on track for its first weekly gain in three.
(Reporting by Arijit Bose in Bengaluru; Editing by Richard Chang)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.