Gold stays near $2,000, as dollar dips ahead of Fed decision
2023.04.24 16:00
Investing.com — Gold prices rose to settle just a shade below the $2,000 mark on Monday as the dollar dipped ahead of a keenly-watched Federal Reserve decision on U.S. interest rates.
on New York’s Comex settled up $9.30, or 0.5%, at $1,999.80. The session high was $2,001.20.
The , which reflects physical trades in bullion and is more closely followed than futures by some traders, was up $4.32, or 0.2%, to $1,987.96 by 15:20 ET (19:20 GMT).
Both spot gold and Comex’s most-active contract for the yellow metal are down about 2.5% or more from an April 13 peak of around $2,050.
But bulls in the space expect a rally in the coming session ahead of the Fed’s May 3rd rate decision.
The U.S. central bank is widely to add another quarter point in what would be its tenth rate increase in under 15 months, bringing rates to a peak of 5.25% from a pandemic era of just 0.25%.
“Gold is trying to get back where it belongs, above the $2,000 an ounce level,” said Ed Moya, analyst at online trading platform OANDA. “A weakening dollar is helping send bullion higher as investors start to grow more confident that the Fed will have to deliver more rate cuts next year. Wall Street sees something breaking and that allows the Fed to shift gears from its inflation fighting mode.”
The and both turned lower Monday after rebounding last week from one-year lows.
Moya said gold was also expected to benefit from safe-haven flows. “Gold’s bullish outlook is based on the amount of risk that is on the table: earnings risk, slower lending, financial stability concerns, and sticky inflation,” he added.
