Gold prices rise
In this article (5)
SJC gold prices gained 0.3% to VND67.2 million per tael Tuesday afternoon.
Gold ring prices shot up 0.8% to VND54.3 million per tael. A tael equals 37.5 grams or 1.2 ounces.
Global spot gold was up 1.2% at $1,846.08 per ounce jumped more than 1% to a six-month high on Tuesday on technical trading, while investors looked forward to minutes from the U.S. Federal Reserve’s latest policy meeting for more cues on its rate-hike path, Reuters reported.
“We’re seeing a slight bid for gold. But, with liquidity very low this time of the year, it appears to be technical buying as opposed to fundamentally driven,” said Matt Simpson, a senior market analyst at City Index.
Minutes from the Fed’s December policy meeting are due on Wednesday. The Fed raised rates by 50 basis points in December after four consecutive increases of 75 basis points each.
“I doubt the minutes will pack as much of a punch as the Fed’s December meet had, but traders will look for confirmation of the lower terminal Fed rate expressed in the median dot plot and that could support gold,” Simpson added.
Gold is considered a hedge against inflation and economic uncertainties, but higher interest rates increase the opportunity cost of holding gold as it pays no interest.
Questions & Answers
Q.What was the closing price of SJC gold per tael on Tuesday afternoon?
What was the closing price of SJC gold per tael on Tuesday afternoon?
SJC gold prices increased by 0.3% to reach VND67.2 million per tael on Tuesday afternoon. This rise coincided with a general upward trend in both local and global gold markets.
Q.Why did global spot gold prices increase to a six-month high on Tuesday?
Why did global spot gold prices increase to a six-month high on Tuesday?
Global spot gold prices rose more than 1% to a six-month high on Tuesday due to technical trading. Investors were also anticipating minutes from the U.S. Federal Reserve’s latest policy meeting for clues on future rate hikes.
Q.What is the expected impact of the upcoming Fed meeting minutes on gold prices?
What is the expected impact of the upcoming Fed meeting minutes on gold prices?
Traders will look for confirmation of a potentially lower terminal Fed rate in the meeting minutes, which could support gold. Gold is seen as an inflation hedge, but higher interest rates increase the cost of holding it.
Q.How do recent Federal Reserve interest rate changes compare to earlier increases?
How do recent Federal Reserve interest rate changes compare to earlier increases?
The Fed raised rates by 50 basis points in December. This followed four previous consecutive increases, each of which was by a larger margin of 75 basis points.
Reader pulse
How will rising gold prices affect consumer retail spending?
17,687 votes so far