Gold firms as investors focus on US data for more Fed cues

[BENGALURU] Gold prices inched higher on Monday (Nov 17) as investors waited for a series of US economic data this week that could shed more light on the Federal Reserve’s interest rate path.

Spot gold was up 0.3 per cent at US$4,091.89 per ounce, as at 9.14 am. US gold futures for December delivery were steady at US$4,094 per ounce.

Focus for this week will be on US data releases, including the September nonfarm payrolls report on Thursday, for clues on the health of the world’s largest economy.

The Commerce Department’s Bureau of Economic Analysis said on Friday it was working to update its schedule of economic data releases affected by the recently ended government shutdown.

Traders are currently pricing in a 46 per cent probability of a quarter-point Fed rate cut next month, down from 50 per cent last week.

Citing worries about inflation and signs of relative stability in the labour market after two interest rate cuts this year, a growing number of Fed policymakers are signalling reticence on further easing.

Non-yielding gold tends to do well in a low-interest-rate environment and during times of economic uncertainties.

Meanwhile, the dollar index held firm against its rivals, making gold less attractive for other currency holders.

Physical gold demand across major Asian markets was subdued last week as elevated prices curtailed buying activity, with discounts in India reaching their highest level in five months.

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SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.47 per cent to 1,044.00 tonnes on Friday from 1,048.93 tonnes on Thursday.

Elsewhere, spot silver rose 0.8 per cent to US$50.94 per ounce, platinum gained 0.1 per cent to US$1,542.37, and palladium climbed 1.2 per cent to US$1,401.50. REUTERS