PRECIOUS-Gold drops as dollar rises on Fed’s upbeat economic view

    * Dollar hits more than one-week high
    * Fed to hold rates near zero until at least 2023
    * Platinum falls more than 2%
    * Interactive graphic tracking global spread of coronavirus:

 (Updates prices)
    By Brijesh Patel
    Sept 17 (Reuters) - Gold prices fell on Thursday as the
dollar climbed after the U.S. Federal Reserve painted a
favourable economic recovery picture but stopped short of
offering concrete signals on further stimulus.
    Spot gold        was down 0.8% at $1,944.63 per ounce by
0700 GMT. U.S. gold futures         slipped 0.9% to $1,951.90.
    "Investors across the Asia-Pacific are perhaps not inspired
by last night's FOMC (Federal Open Market Committee) meeting, in
which the central bank seems to be reluctant to add stimulus in
view of improving fundamentals," said Margaret Yang, a
strategist with DailyFx, which covers currency, commodity and
index trading.
    "This led to a stronger U.S. dollar, and a weaker gold
    The dollar index        rose to a more than one-week high
against its rivals after the Fed signalled on Wednesday it
expected the U.S. economic recovery from the coronavirus crisis
to accelerate, with unemployment falling faster than the central
bank's forecast in June.                                 
    Meanwhile, the Bank of Japan kept monetary policy steady and
slightly upgraded its view on the economy, suggesting that no
immediate expansion of stimulus was needed to combat the
coronavirus pandemic.             
    Offering gold some support, the Fed pledged to keep rates
pinned near zero levels until inflation was on track to
"moderately exceed" its 2% inflation target "for some time".
    Lower interest rates decrease the opportunity cost of
holding non-yielding bullion. Gold is also used as a hedge
against inflation.
    "Lower-for-longer interest rates, continued quantitative
easing by central banks and the U.S. fiscal position potentially
debasing the dollar continue to be long-term supportive factors
for a higher gold price," said Jeffrey Halley, a senior market
analyst at OANDA.
    Elsewhere, silver        dropped 1.7% to $26.78 per ounce,
platinum        dipped 2.4% to $945.35 and palladium       
slipped 1.4% to $2,366.91.

 (Reporting by Brijesh Patel in Bengaluru; Editing by Devika
Syamnath and Kevin Liffey)

Next Post

Fabric Stain Remover Market - Global Industry Analysis and Opportunity Assessment, 2020-2030

Sun Sep 20 , 2020
The MarketWatch News Department was not involved in the creation of this content. NEW YORK, Aug. 31, 2020 /PRNewswire via COMTEX/ — NEW YORK, Aug. 31, 2020 /PRNewswire/ —  Fabric Stain Remover Market: Global Industry Analysis 2015-2019 & Opportunity Assessment 2020-2030  Read the full report: A recent market study […]
Global B2B Telecommunication Market 2020 by Manufacture, Size, Share, Industry Outlook and Survey 2025

You May Like