Gold steadied after rising moderately the previous day, as traders assessed Middle East tensions following President Donald Trump’s comments that the US wouldn’t attack Iran before November midterm elections. Bullion traded near $4,145 an ounce, recovering from a two-month low seen earlier this week, after Trump said the US was having “productive discussions” with Iran, without offering details. Benchmark oil prices declined, though a hurricane menacing production in the Gulf of Mexico kept risks elevated.
Trump’s comments came even as Iran ramped up the pace of attacks on tankers in the Strait of Hormuz this week, raising fresh concerns over a war now in its eighth month. That’s renewed inflation worries over rising energy costs, which has prompted some central banks to tighten monetary policy and weighed on the non-yielding precious metal. Traders are expecting US borrowing costs to stay unchanged later this month but increase over the medium term.
Federal Reserve Bank of St. Louis President Alberto Musalem signaled on Thursday that interest rates should increase over the next six to nine months to help inflation return to the central bank’s 2% target, but stopped short of endorsing a move at this month’s policy meeting. Gold was 0.3% higher at $4,144.05 an ounce as of 8:00 a.m. Singapore time, while silver was 0.6% higher at $59.54 an ounce, after falling 1% in the earlier session. Platinum and palladium edged higher.
The Bloomberg Dollar Spot Index, a gauge of the US currency, was little changed.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing