Gold rally gains momentum ahead of US inflation data, Jackson Hole event
Spot gold rose 1.5%, reaching its highest level since May, as the market awaits new reports on interest rates.
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Gold prices rose to their highest in more than three months on Monday, as technical buyers piled into a rally driven by the U.S. Treasury’s recent buyback announcement and a weaker dollar ahead of this week’s inflation data and the Jackson Hole Symposium.
Spot gold rose 1.5% to $4,673.20 per ounce by 1535 GMT (11:35 a.m. EDT), its highest level since May 14. U.S. gold futures for December delivery rose 1.1% to $4,730.40 per ounce.
“The fundamentals and technicals are kind of lining up bullish for the gold market here to start the trading week,” said Jim Wyckoff, a market analyst at American Gold Exchange. He also said that bond yields “have stabilized, even dipped a little bit today”, supporting the metal.
With prices trending higher, Wyckoff said the path of least resistance for gold “will continue to be sideways to higher” in the coming weeks, barring a technical reversal signal.
Gold broke above its 200-day moving average last week, further strengthening the upward price momentum.
Gold-backed ETFs also attracted inflows of 46.7 metric tons ($6.4 billion) last week, which was their largest weekly demand in 10 months, according to the World Gold Council, with North American and Europe-listed funds leading the inflows.
Bullion rose more than 5% last week after the U.S. Treasury Department’s buyback support plan pushed the dollar to multi-month lows, making greenback-priced bullion cheaper for foreign buyers.
The U.S. dollar hovered near multi-month lows as traders awaited details on Iran-related sanctions from Treasury Secretary Scott Bessent. He is expected to announce more details at a press conference at 1 p.m. EDT (1700 GMT).
Market focus is also on policy speeches this week in the U.S. and Japan.
Markets are awaiting the Personal Consumption Expenditure price index, the Federal Reserve’s favored inflation gauge, due on Wednesday and Chair Kevin Warsh’s debut speech at the Jackson Hole Symposium on Friday to understand the outlook on interest rates.
Spot silver inched 0.2% up to $69.06 per ounce, platinum gained 0.8% to $1,892.03, and palladium rose 1.8% to $1,374.27.
(Reporting by Dharna Bafna and Swati Verma in Bengaluru; Editing by Emelia Sithole-Matarise and Diti Pujara)
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