Gold steady as Fed caution on global economy pressures dollar

Gold prices were steady on Monday, with the dollar subdued after comments from Federal Reserve officials showing caution over the global economy, prompting traders to reassess the pace of future U.S. interest rate hikes.

Spot gold was little changed at $1,220.70 per ounce at 0417 GMT, having gained about 0.7 percent in the previous session.

U.S. gold futures were down 0.1 percent at $1,222.3 per ounce.

The possibility that the Fed might hold a neutral outlook beyond 2018, and a slowdown in the global economy amid the ongoing U.S.-China trade spat will keep investors a little more interested in gold's safe haven appeal, said Benjamin Lu, a commodities analyst with Phillip Futures.

Fed policymakers on Friday signalled further interest rate increases ahead, even as they raised relatively muted concerns over a potential global slowdown, leading markets to suspect the tightening cycle may not have much further to run.

A fourth rate hike for this year is expected next month and policymakers had earlier indicated two more by June 2019.

"For December the rate hike is already priced in and it's most likely going to happen," Lu said.

"What people will be watching out for is any decline in economic indicators that could result in a softening of the dollar (that would) help gold gain," he said.

Prospects of higher U.S. interest rates are negative for dollar-priced gold as they raise the opportunity cost of holding the bullion.

Stock Market Tips and recommendations Follow Market captains .

Comments

Keep 5-yr investment horizon for Long Term Equity Fund

Though the fund has done well over past five years, the investors must be prepared to tolerate short-term under performance in case there is a sudden rally that overlooks fundamentals . Investment strategy The scheme has invested in a concentrated portfolio of around 25 stocks. The stocks are picked up on a bottom-up basis. The fund manager identifies investment opportunities that would deliver over a five-year time frame. “We don’t put much emphasis on the macro environment and the associated factors since they are not predictable and not within anyone’s control. Should you invest now? The scheme’s portfolio has cut its net exposure to Indian stocks over past two years. Compared to 62 percent in September 2016, it came down to 55 percent in September 2017 and to 45 percent now, in line with rising valuations of quality companies. High cash levels and exposure to overseas stocks have helped the fund to weather recent sharp correction in Indian stocks....

Oil prices fall on rising US rig count, Illinois refinery fire

US West Texas Intermediate (WTI) crude futures were at $51.92 per barrel at 0144 GMT, down 80 cents, or 1.5 percent, from their last settlement. Oil prices fell by more than 1 percent on Monday as US drilling activity picked up and as a refinery fire in the US state of Illinois resulted in the shutdown of a large crude distillation unit. US West Texas Intermediate (WTI) crude futures were at $51.92 per barrel at 0144 GMT, down 80 cents, or 1.5 percent, from their last settlement. International Brent crude oil futures were down 71 cents, or 1.1 percent, at $61.39 a barrel. In the United States, energy firms last week increased the number of oil rigs operating for the second time in three weeks, a weekly report by Baker Hughes said on Friday. Companies added 7 oil rigs in the week to Feb. 8, bringing the total count to 854, pointing to a further rise in US crude production, which already stands at a record 11.9 million bpd. WTI prices were also weighed down by the ...

Wall Street drops, S&P 500 confirms correction

The Dow Jones Industrial Average fell 178.74 points, or 0.73 percent, to 24,285.95, the S&P 500 lost 17.37 points, or 0.66 percent, to 2,632.56 and the Nasdaq Composite dropped 33.27 points, or 0.48 percent, to 6,938.98. US stocks closed lower in a shortened post-holiday trading session on Friday as the energy sector tumbled on continued weakness in oil prices, and the benchmark S&P 500 confirmed its second correction of 2018. The three major US indexes all fell well over 3 percent for the week, with the Dow industrial and the Nasdaq posting their biggest weekly percentage declines since March. The S&P 500 ended about 10.2 percent down from its September 20 closing record high, confirming it had entered a correction. The S&P last entered a correction earlier this year after posting a then record high in late January, and falling more than 10 percent by early February. That correction lasted roughly seven months, until the index posted a fr...

Market Captain Investment Advisor

Search This Blog