Gold climbs on weaker dollar, easing Fed rate hike concerns
GLD•Other precious metals
Among other metals, spot silver XAG= rose 2.8% to $66.44 per ounce. Platinum XPT= gained 2% to $1,783 per ounce while palladium XPD= climbed 1.5% to $1,332.49 per ounce.
Fed outlook and geopolitics in focus
Markets pared bets on a Federal Reserve rate hike after last week's weaker-than-expected U.S. payrolls report and subdued consumer inflation data.
Investors are now awaiting minutes from the Fed's July meeting, due on Wednesday, for clues on the central bank's policy outlook.
Traders see a 33% probability of a September rate increase, down from 51.2% a month earlier, CME's FedWatch Tool showed. FEDWATCH/
Gold, which pays no interest, tends to benefit from lower interest rates as they reduce the opportunity cost of holding bullion.
On the geopolitical front, a senior Iranian official told Reuters that Tehran would step up tensions in the Strait of Hormuz and across the region if diplomatic efforts with the United States break down, signaling a more offensive approach.
Gold rises as dollar weakens and Fed hike bets fade
Gold prices rose on Monday, supported by a weaker dollar and fading expectations of a U.S. Federal Reserve rate hike, while investors continued to monitor geopolitical tensions in the Middle East.
Spot gold XAU= was up 1.2% at $4,426.52 per ounce by 11:56 a.m. EDT (1555 GMT). U.S. gold futures GCcv1 for December delivery edged 1.1% higher to $4,484.10.
The gold market appears to be pricing in a stagflationary environment, with softer employment and expectations that the Fed will tolerate current inflation levels, said Bart Melek, global head of commodity strategy at TD Securities.
