By Seher Dareen
(Reuters) – Gold prices hit their highest since March 2022 on Wednesday, extending a rally after weaker U.S. economic readings bolstered bets U.S. interest rates will rise more slowly.
Spot gold rose 0.1% to $2,021.97 per ounce by 0925 GMT, while U.S. gold futures were steady at $2,038.70.
Analysts said gold was well-placed to sustain gains above the $2,000 level as weaker prospects for interest dilute the opportunity cost of holding non-yielding gold, which is also a hedge against inflation and economic uncertainty.
“The ‘third time’s the charm’ for gold, having probed above the $2,000 level in both August 2000 and March 2022. This time it appears to be able to sustain the momentum as dark clouds gather within the economy,” independent analyst Ross Norman said.
He said weaker economic data had shifted the emphasis from “inflation-busting to saving the wider economy”.
Gold rallied 2% on Tuesday after U.S. job openings in February dropped to the lowest in nearly two years.
The dollar index steadied, but was still near two-month lows, making bullion cheaper for buyers holding other currencies. [USD/]
Gold priced in the euro and sterling was at the highest in more than a week.
In Europe, the Euro zone recovery gathered pace last month but the upturn was uneven across countries. The ECB could raise rates by 25 basis points at its May, June and July meetings a Reuters poll found.
While the markets expect a pause on U.S. rate hikes in May, Federal Reserve Bank of Cleveland President Loretta Mester said the central bank likely had more rate hikes ahead, pushing the terminal rate over 5%.
Traders also await economic cues from the U.S. non-farm payrolls data on Friday.
Silver fell 0.9% to $24.78 per ounce, platinum rose 0.2% to $1,019.44 while palladium was up 0.5% to $1,463.81.
GRAPHIC – xau
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(Reporting by Seher Dareen in Bengaluru; editing by Barbara Lewis)
Disclaimer: This report is auto generated from the Reuters news service. ThePrint holds no responsibilty for its content.
Source: The Print
