Gold prices rose on Wednesday after selective buying by investors following a drop in the precious metal to a three-week low in the previous session, as investors awaited the U.S. Federal Reserve’s decision on interest rates later in the day.
اضافة اعلان
Spot gold increased by 0.7% to $1,977.30 per ounce by 06:34 GMT, after falling on Tuesday to its lowest level since October 7. U.S. gold futures for December delivery rose 0.2% to $1,990.60 per ounce.
Kelvin Wong, Chief Market Analyst at OANDA, said, “The short-term correction in gold prices is due to investors shifting from safe-haven assets to more responsive assets like global equities, driven by optimism about global trade.” He added, “Gold is under temporary downward pressure from short-term investors adjusting positions, but the fundamental factors remain supportive of the yellow metal.”
Over the weekend, U.S. and Chinese officials reached a preliminary framework for a trade agreement between President Donald Trump and Chinese President Xi Jinping, which includes freezing U.S. tariff increases and easing Chinese restrictions on rare metal exports. The two leaders are scheduled to meet on Thursday in South Korea.
ANZ noted in a briefing that “progress in U.S.-China trade talks reduces demand for safe-haven assets such as gold, which continued to decline as tensions eased. However, this decline could provide an opportunity for central banks to increase purchases.”
The U.S. Federal Reserve is widely expected to cut interest rates by a quarter-point at the conclusion of its meeting on Wednesday, while investors will closely watch Fed Chair Jerome Powell’s comments for forward guidance. Meanwhile, the European Central Bank is expected to keep interest rates unchanged at its Thursday meeting.
Gold, as a non-yielding asset, tends to thrive in a low-interest-rate environment and during periods of economic uncertainty.
Gold prices have risen about 52% since the start of the year, reaching an all-time high of $4,381.21 per ounce on October 20, supported by geopolitical and economic uncertainty, expectations of interest rate cuts, and continued central bank buying.
Other metals also saw gains: silver rose 1.5% to $47.73 per ounce, platinum increased 0.1% to $1,587.70 per ounce, and palladium rose 0.9% to $1,405.99 per ounce.
— Reuters
