Nov 28 ((NDTV) – Gold Prices hit a more than six-month high on Monday, firming above the $2,000 per ounce level, as a weaker dollar and expectations of an end to US interest rate hikes lifted demand.
Spot gold was up 0.6 percent at $2,013.99 per ounce by 1311 GMT, after reaching its highest since May 16. US gold futures also rose 0.6 percent to $2,015.00.
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The dollar eased 0.2 percent against a basket of major currencies, hovering around a more than two-month low touched last week and making gold less expensive for holders of other currencies [USD/)
“Gold is flying and to really explain it, is the fact that it’s finally broken above $2,000 in a significant way,” said Craig Erlam, senior markets analyst at OANDA, describing the move as “purely technical” and driven by last week’s US inflation data and jobs report.
Gold prices are well above their 50-, 100- and 200-day moving averages and are around $60 away from August 2020’s all-time high of $2,072.49.
Investors’ attention is on the release of revised US third-quarter GDP figures on Wednesday and the PCE price index, the Fed’s preferred inflation gauge, on Thursday.
“Economic figures coming out of the US this week, both on the growth and inflation front, will make or break a case for whether gold remains above $2,000,” said Kyle Rodda, a financial market analyst at Capital.com.
The latest data indicating a slowdown in US inflation has increased expectations of an earlier-than-expected easing of monetary conditions by the Federal Reserve.
Traders widely expect the Fed to hold rates in December, while pricing in about a 60 percent chance of a cut in May next year, CME’s FedWatch Tool shows.
Lower interest rates reduce the opportunity cost of holding non-interest-bearing assets, often boosting gold prices.
Silver jumped 1.7 percent to $24.71 per ounce, platinum fell 0.3 percent to $927.64 and palladium was up 0.8 percent to $1,077.56 per ounce.
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