Last Update: May 31, 2023, 02:18 AM IST
New York, United States (USA)
FILE PHOTO: A saleswoman shows gold bangles to a customer at a jewelery showroom on the occasion of Akshaya Tritiya, a major gold shopping festival, in Kolkata, India May 3, 2022. (Image: Reuters)
Spot gold was up 0.8% at $1,958.80 an ounce as of 2:30 p.m. EDT (1830 GMT)
Gold bounced back from early losses on Tuesday as the dollar recovered and Treasury yields edged lower on broad market optimism about a US debt limit deal.
Spot gold was up 0.8% at $1,958.80 an ounce at 2:30 p.m. EDT (1830 GMT) after hitting its lowest level since March 17. US gold futures rose 0.7% to $1,958.00.
The dollar eased from a 10-week high, making bullion cheaper for holders of other currencies, while the benchmark 10-year Treasury yield fell to a one-week low. [USD/] [US/]
With these positive elements, “you could see some fund managers increasing positions towards the end of the month, taking profits on their short positions and buying back,” said Jim Wyckoff, senior analyst at Kitco Metals.
“In the near term, unless we see a fresh catalyst, gold prices are going to be lower.”
Returning from the long US weekend, traders were also assessing Friday’s surprisingly strong US economic data, which bolstered the case for further tightening of monetary policy to curb inflation.
Ole Hansen, head of commodities strategy at Saxo Bank, said earlier concerns over the US debt deal had supported prices, but gold remained under pressure from a change in the Federal Reserve’s rate hike path.
The appeal of zero-yield gold diminishes in a high-interest rate environment.
Traders now see the Fed as more likely to hike rates next month than to leave them unchanged, seen as alleviating some of the economic risks in the debt deal that could have kept the central bank on edge.
The deal faces its first test in Congress, with both Democratic President Joe Biden and top congressional Republican Kevin McCarthy hoping for enough votes to pass it into law.
Silver fell 0.1% to $23.17 an ounce, platinum fell 0.6% to $1,018.44 and palladium fell 0.6% to $1,406.82.
(This story has not been edited by News18 staff and is published from a syndicated news agency feed – reuters,
