By Brijesh Patel
(Reuters) – Gold prices ticked up on Wednesday, helped by a pullback in the dollar, while investors awaited minutes of the Federal Reserve’s latest policy meeting and U.S. jobs data for more clarity on the interest rate outlook.
Spot gold was up 0.3% at $2,064.55 per ounce, as of 0454 GMT. U.S. gold futures were flat at $2,073.
The dollar slipped 0.2% against its rivals, making gold less expensive for other currency holders.
“Gold is in consolidation mode at the moment, really building on those 2023 gains with potentially more to come should the current expectations for a dovish Fed in 2024 hold,” said Tim Waterer, chief market analyst, KCM Trade.
Traders have doubled down on bets for rate cuts in 2024, encouraged by slowing inflation and the Fed’s dovish tilt at its December policy meeting.
Those expectations helped gold post a 13% jump in 2023, its first annual gain since 2020, as lower interest rates decrease the opportunity cost of holding non-yielding bullion.
Focus now shifts to the minutes of the U.S. central bank’s December policy meeting, due at 1900 GMT. Futures markets see a 70% chance of a 25 basis points rate cut at the March 20 meeting, according to CME’s FedWatch Tool.
Investors are also keenly awaiting a slew of U.S. economic data this week, including non-farm payrolls report on Friday.
“There is certainly a chance we could see gold going to $2,100 per ounce in the near term, if we don’t getting up stream of upside surprises in the macro gauges,” Waterer said.
Investors are also keeping a close watch on tensions in the Middle East after Israel killed Hamas deputy leader Saleh al-Arouri in a drone strike in Lebanon’s capital Beirut on Tuesday.
Spot silver edged up 0.1% to $23.65 per ounce, while platinum was flat at $981.59. Palladium rose 0.7% to $1,088.24.
(Reporting by Brijesh Patel and Tina Parate in Bengaluru; Editing by Subhranshu Sahu, Sherry Jacob-Phillips and Varun H K)
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