Gold prices moved higher on Monday, supported by a weaker U.S. dollar, as investors balanced easing geopolitical tensions in the Middle East with expectations ahead of this week’s Federal Reserve policy decision.
Spot gold advanced 1.1% to $4,096.36 an ounce by 06:52 GMT, while August Gold Futures gained 0.68% to $4,098.60 an ounce.
The precious metal also finished last week almost 1% higher despite heightened market volatility.
Declining dollar boosts precious metals
A 0.3% fall in the U.S. Dollar Index increased the appeal of gold for overseas buyers by making dollar-denominated bullion less expensive.
The metal also benefited from a sharp fall in oil prices after the United States and Iran maintained their pause in military operations over the weekend, reducing concerns about a broader regional conflict.
President Donald Trump suspended the U.S. bombing campaign on Friday following 13 consecutive nights of strikes on Iranian targets, allowing diplomatic discussions to continue. Iran also refrained from retaliatory attacks on neighbouring countries hosting U.S. military bases.
The decline in crude oil prices has eased inflation concerns, although investors remain cautious ahead of the Federal Reserve meeting later this week.
Markets await signals from the Federal Reserve
The Federal Reserve is widely expected to leave interest rates unchanged on Wednesday.
However, markets will closely analyse comments from Chair Kevin Warsh for any indication of when interest rate cuts could begin and how policymakers view the current inflation outlook.
Investors are also awaiting key U.S. economic releases, including inflation figures and employment data, which could influence expectations for future monetary policy.
Silver, platinum and copper move higher
Other metals also traded higher on Monday. Silver climbed 2.1% to $59.39 an ounce, while platinum gained 2.3% to $1,630.83 an ounce.
Copper prices also strengthened, with benchmark London Metal Exchange copper futures rising 0.4% to $13,693.58 per tonne, while U.S. Copper Futures held steady at $6.36 per pound.
Leave a Reply