Gold secures a weekly increase after continuous hold to $1,900
Updated
Gold had a decent week, thanks to the US dollar's first weekly drop in two months. Gold held its ground above $1,900, managing a small weekly gain.
The main futures contract for gold, called December, ended at $1,946.20 per ounce, up $13.30 for the day, or 0.7%. For the week, it inched up by $3.50, or 0.2%.
The spot price of gold, which hit a high of $1,930.90 per ounce earlier this week, settled at $1,924.22 as of 13:55 ET (17:55 GMT). This meant a 0.4% weekly gain for spot gold, which reflects real-time trades in actual gold.
This week, people were watching to see if gold could stay above $1,900, especially after the US Consumer Price Index rose higher than expected for the second month in a row. This raised concerns about inflation and what the Federal Reserve might do with interest rates.
Global markets were also adjusting after the European Central Bank raised rates to 4%, hinting it might be done with rate hikes.
The Fed isn't likely to raise rates when it meets on September 20. But people will be listening closely to what Chairman Jerome Powell says during his news conference for clues about the Fed's plans for the rest of the year.
Since the Fed isn't expected to raise rates soon, some investors took profits from the recent rise in the US dollar, giving gold a boost as a safe-haven investment.
Ed Moya, an analyst at OANDA, said, "Gold prices are surging as risk aversion percolates. A lot of pessimism is growing across Europe, triggering safe-haven flows toward gold. The key for gold is for global bond yields to retreat, which may not happen until we get past next week's central bank meetings, which could indicate the end of tightening measures for advanced economies."
In August, US consumer prices went up for a second straight month, hitting a year-on-year growth rate of 3.7%, compared to 3.2% in July. Gasoline prices were the main reason, accounting for more than half of the increase. This could put more pressure on the Fed's efforts to control inflation. The Fed's goal is to keep inflation at 2% per year, and it's ready to raise rates more if needed.
The main futures contract for gold, called December, ended at $1,946.20 per ounce, up $13.30 for the day, or 0.7%. For the week, it inched up by $3.50, or 0.2%.
The spot price of gold, which hit a high of $1,930.90 per ounce earlier this week, settled at $1,924.22 as of 13:55 ET (17:55 GMT). This meant a 0.4% weekly gain for spot gold, which reflects real-time trades in actual gold.
This week, people were watching to see if gold could stay above $1,900, especially after the US Consumer Price Index rose higher than expected for the second month in a row. This raised concerns about inflation and what the Federal Reserve might do with interest rates.
Global markets were also adjusting after the European Central Bank raised rates to 4%, hinting it might be done with rate hikes.
The Fed isn't likely to raise rates when it meets on September 20. But people will be listening closely to what Chairman Jerome Powell says during his news conference for clues about the Fed's plans for the rest of the year.
Since the Fed isn't expected to raise rates soon, some investors took profits from the recent rise in the US dollar, giving gold a boost as a safe-haven investment.
Ed Moya, an analyst at OANDA, said, "Gold prices are surging as risk aversion percolates. A lot of pessimism is growing across Europe, triggering safe-haven flows toward gold. The key for gold is for global bond yields to retreat, which may not happen until we get past next week's central bank meetings, which could indicate the end of tightening measures for advanced economies."
In August, US consumer prices went up for a second straight month, hitting a year-on-year growth rate of 3.7%, compared to 3.2% in July. Gasoline prices were the main reason, accounting for more than half of the increase. This could put more pressure on the Fed's efforts to control inflation. The Fed's goal is to keep inflation at 2% per year, and it's ready to raise rates more if needed.
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