Gold Prices Remain Higher on Weaker Dollar
Investing.com – Gold prices remained higher on Monday, as concerns over low levels of inflation in the U.S. and the potential consequences for the Federal Reserve’s interest rate policy continued to weigh heavily on the greenback.
Comex were up $7.05 or about 0.55% at $1,294.29 a troy ounce by 08:05 a.m. ET (12:05 GMT).
Sentiment on the greenback remained vulnerable after last Wednesday’s of the Federal Reserve’s November meeting showed that some officials were concerned inflation would stay below the bank’s 2% target for longer than expected.
The minutes echoed comments by Fed Chair Janet Yellen earlier in the week that she was uncertain about the inflation outlook.
While a rate hike in December is still almost fully priced in, investors pared back expectations for further rate hikes in 2018.
Market participants also continued to focus on a potential U.S. tax reform plan. President Donald Trump on Tuesday to discuss the party’s efforts to pass tax reform legislation.
The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.17% at 92.55, the lowest since September 26.
Gold is sensitive to moves in both U.S. rates and the dollar. A weaker dollar makes gold less expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.
Elsewhere on the Comex, were up 0.60% at $17.09 a troy ounce.
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