Oct 24, 2022
VOT Research Desk
Market Insights, Considerations & Analytics
-Gold prices fell on Monday, after having increased by 1.8% in the previous session, as the U.S. dollar strengthened. However, a glimmer of hope that the U.S. Federal Reserve will adopt a less aggressive policy stance later in the year prevented further declines.
As of 3:00 p.m. GMT, the price of one ounce of spot gold was $1,654.68.On Friday, prices experienced their largest daily gain since Oct. 3.
At $1,658.40, U.S. gold futures were up 0.1 percent.
The appeal of greenback-priced gold for overseas buyers was diminished by a 0.4% increase in the dollar index.In the meantime, yields on the benchmark 10-year Treasury note were down from Friday’s close to 15-year high.USD/] City Index analyst Matt Simpson stated, “I don’t think gold is out of the woods yet,” adding that gold’s movement will depend on data and clues from the Fed’s next meeting regarding whether it is close to pausing or will continue tightening interest rates.
Even though the Federal Reserve is expected to raise its benchmark overnight interest rate by 75 basis points at its meeting in November, officials are beginning to feel the need to take a break.
The San Francisco Fed’s president, Mary Daly, said on Friday that the bank should avoid inducing a “inadvertent slowdown” and that it is time to start talking about slowing the rate of interest rate increases. Gold prices have decreased by more than 9% so far this year as a result of strong increases in U.S. interest rates. The multiplier effect of retaining the non-yielding asset increases as a result.
We’re probably looking at the $1,500-$1,600 range as we get into next year if there’s no Fed pivot and inflation continues to rip higher.
On Friday, the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, saw its holdings decrease by 0.3 percent to 928.10 tons, which is an indication of sentiment.
Palladium fell 0.1 percent to $2,021.31, while spot silver dropped 0.8 percent to $19.24 per ounce.
Platinum fell 0.1 percent to $930.75 earlier in the session, having reached its highest level since August 15.
