Gold prices edged higher on Monday as softer oil prices tempered inflation concerns, while investors awaited the US Federal Reserve's policy decision later this week, Reuters reported. Spot gold rose 0.4% to $4,009.87 per ounce by 0342 GMT, after hitting its lowest level since mid-July in the previous session, and a later Reuters update put spot gold at $4,010.51 by 0544 GMT. US gold futures for December delivery gained 0.4% to $4,023.50.
Source: Reuters, Oct 26, via The Hindu BusinessLine
Yaani - one ounce (about 31 grams) of gold is trading above the $4,000 mark again, after last week's sharp fall took it to its lowest since mid-July. "The jump that we've seen is mostly symptomatic of the kind of relief provided by a lower oil price, but one that could easily be capped as markets position for the FOMC decision in a couple of days' time," said Kyle Rodda, senior financial market analyst at Capital.com, quoted by Reuters. "Gold will continue to trade as a function of interest rate expectations and geopolitical risks."
Source: Reuters, Oct 26 - Kyle Rodda, Capital.com
Oil prices fell on Monday after surging to near six-month highs late last week, although ongoing attacks on Saudi Arabia kept supply concerns in focus, Reuters reported. A separate commodity report on Monday put US crude futures down $1.60, or 1.55%, at $101.67 a barrel and Brent crude futures down $1.56, or 1.34%, at $115.16, after prices had settled nearly $3 higher on Friday following Houthi attacks in Saudi Arabia; Brent finished last week up 6% and US crude up 2.3%. The same report said silver climbed 0.5% to $54.12 an ounce, having given up 5.4% last week, while platinum and palladium edged higher and the dollar index was a shade weaker at 101.64.
Source: Moneycontrol commodity report, Oct 26, via TradingView
Fed meeting and inflation data in focus
Qatari mediators were in Tehran on Sunday to help de-escalate regional tensions in coordination with the United States, an official briefed on the situation told Reuters. Markets await the Fed's policy meeting on October 28, and US Personal Consumption Expenditures (PCE) data - a gauge the central bank watches closely as it targets a 2% inflation rate - is due the next day. Traders largely expect the central bank to leave rates unchanged this week, while expectations for a hike in December are at 75%, according to CME's FedWatch Tool, Reuters reported. Although gold is typically seen as an inflation hedge, higher interest rates tend to diminish non-yielding bullion's appeal. US business activity slowed modestly in October, though robust demand allowed companies to raise prices - a sign inflation could increase further, Reuters added.
Source: Reuters, Oct 26