Gold edges higher on investor short-covering, softer dollar
Shafaq News/ Spot gold edged higherin thin trade on Monday, as investors covered their short-positions after theU.S. Federal Reserve's cautious stance on rate cuts for 2025 dragged prices toone-month lows last week.
Spot gold added 0.2% to $2,626.47per ounce, as of 0510 GMT, trading in a narrow $11 range. U.S. gold futureseased 0.1% to $2,641.50.
The Fed's 25-basis-points rate cuton Dec. 18 and the cautious note struck by its economic projections andexpectations of fewer cuts in 2025 pushed gold to its lowest since Nov. 18.
"We are entering the holidaymode and gold's mainly been helped by short-covering, which started on Fridayitself and there is some technical support as well," said Ajay Kedia,director at Kedia Commodities, Mumbai.
Gold gained on softer U.S. dollarand Treasury yields on Friday, when U.S. economic data hinted at a slowdown ininflation.
Monthly inflation in the U.S. slowedin November after little improvement in recent months, data on Friday showed.The personal consumption expenditures (PCE) index rose 0.1% last month after anunrevised 0.2% gain in October.
San Francisco Fed President MaryDaly and two other Fed policymakers said they felt the central bank wouldlikely resume rate cuts next year but take their time given that the"recalibration phase" was over.
Higher rates dull non-yieldingbullion's appeal.
"The next big impact is theincoming presidency of Mr. Trump and the initial presidential decrees that hemight declare. This has the potential to add to market volatility and bebullish for gold prices," said Michael Langford, chief investment officerat Scorpion Minerals.
Meanwhile, COMEX gold speculatorscut net long positions by 16,251 contracts to 203,937 in the week to Dec. 17,data showed.
Spot silver rose 0.6% to $29.69 perounce and platinum climbed 0.9% to $934.38, while palladium steadied at$922.04.
(REUTERS)
