Gold recovered some of its recent losses on Monday, helped by a pullback in the dollar and easing fears about an oversized rate hike by the US Federal Reserve, reports Reuters.
Spot gold was up 0.3 per cent at $1,712.49 per ounce by 1242 GMT, after rising 1 per cent earlier in the session. US gold futures rose 0.4 per cent to $1,711.00. Last week bullion hit its lowest in nearly a year.
The dollar index was off its near 20-year high, down 0.5 per cent, making greenback-priced gold less expensive for buyers holding other currencies.
"Markets are paring back the odds of a 100-basis point Fed rate hike at its July policy meeting, which is translating into some measure of relief for bullion," said Han Tan, chief market analyst at Exinity.
US consumers tempered their inflation expectations in July alongside a sharp drop in gasoline prices over the past month, a development likely to be welcomed by Federal Reserve officials worried that expectations for high inflation could become embedded and complicate their task of reining in price increases.
Fed's aggressive inflation-fighting policy has dented bullion's safe-haven appeal, as rising interest rates make the non-interest bearing asset seem less attractive.
"However, with a 75-basis point move now looking more likely, the US dollar has weakened slightly from the record it hit last week, providing relief across equity and commodity markets," said Rupert Rowling, market analyst at Kinesis Money.
Gold recoups some losses
FE Team | Published: July 18, 2022 21:44:08
Gold recoups some losses
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