the high-interest After a turbulent 2022, Gold rises started the new year at a more than six-month high on Tuesday as investors prepared for the release of the Federal Reserve’s most recent policy minutes.
By 1000 GMT, spot gold had risen 0.8% to $1,838.54 per ounce, reaching its highest level since June 17 of last year. Futures for US gold increased 1% to $1,844.70.
Benchmark The potential cost of owning gold, which doesn’t pay interest, decreased as US 10-year Treasury yields decreased to their session lows.
Giovanni Staunovo an analyst with UBS, stated that “instead, the new year is supporting new inflows into all asset classes.”
The expectations for higher US interest rates and reduced US inflation are seen as negative factors for the price of gold. However, the forecast for higher gold prices later in the year is still in place. It is expected that the Federal Reserve will conclude its rate hikes by that time.
The market is paying attention to the minutes from the Federal Reserve’s December policy meeting. These minutes are set to be released on Wednesday. Additionally, other economic data is expected to be released this week, which may also be of interest to market participants.
During times of economic instability, gold is often considered a good investment hold. However, high-interest rates can make gold less appealing to investors.
In a Fed-driven year, gold experiences its greatest quarter since mid-2020.
Federal Reserve policies that were seen as hawkish (likely to lead to higher interest rates) caused the value of the US dollar to increase. This dollar rally posed a threat to gold, which is often seen as a safe investment. As a result of these factors, gold registered a slight annual loss in 2022.
Saxo Bank made a statement in a note. In this statement, Saxo Bank mentioned that central banks had de-dollarized a lot last year, buying a record amount of gold. Saxo Bank believes that this trend is likely to continue, which will create a “soft floor” in the market.
Technically, the report stated that gold will seek resistance between $1,850 and $1,878. This will occur after it passes $1,842, which is the 50% mark of the 2022 decline.
Spot silver increased by 1.6% to $24.37 an ounce. Platinum increased by 1.4% to $1,083.98. Palladium increased by 0.6% to $1,805.01 in another trading.
