According to foreign news on January 20, gold prices fell slightly on Thursday, hovering near two-month highs, as the weakness of the dollar offset the rising pressure from US Treasury yields, and investors are looking for clues about the Federal Reserve / FED rate hike timetable from next week's policy meeting.
Spot gold rose 0.09 per cent to $1838.09 an ounce, earlier hitting its highest level since Nov. 22 at $1844.04. Gold posted its biggest gain in three months on Wednesday as the dollar weakened and safe-haven demand increased.
Us futures fell 0.23% to $1839.00.
Margaret Yang, a strategist at DailyFX, said that despite some profit-taking after Wednesday's rally, the situation in Russia and Ukraine could still push gold prices higher as investors seek safe-haven assets to hedge the risk of geopolitical tensions.
The dollar index extended losses for the second day in a row, supporting gold as a weaker dollar made gold cheaper for investors holding other currencies, while benchmark 10-year Treasury yields rose slightly, increasing the opportunity cost of holding gold.
The Fed will tighten monetary policy much faster than expected a month ago to curb persistently high inflation. At present, economists believe that high inflation is the biggest threat to the US economy in the coming year.
Although gold is seen as a hedge against inflation, it is highly sensitive to higher US interest rates, which increase the opportunity cost of holding interest-free gold.
Asian stock markets rose on Thursday, breaking a five-day slump and shrugging off the impact of overnight falls in European and US stocks, as China cut quoted interest rates in the loan market, highlighting the country's different monetary policy and economic performance.
Spot silver rose 0.05% to $24.145 an ounce, platinum fell 0.38% to $1024.50, and palladium fell 0.44% to $1999.50.
