GOLD prices steadied on Thursday (Sep 26) after hitting a record high on the previous session, aided by the expectations for another big rate cut by the US Federal Reserve, while traders await Federal Reserve chair Jerome Powell’s comments for further hints on the policy outlook.
Spot gold held its ground at US$2,656.60 per ounce, as at 0021 GMT. Bullion hit a record high of US$2,670.43 on Wednesday.
US gold futures edged 0.2 per cent lower to US$2,680.00.
The report from the Commerce Department on Wednesday also showed sales of new US single-family homes fell less than expected in August.
The Federal Reserve delivered a 50-bp cut at its last policy meeting and traders see a 58 per cent chance of another half-percentage-point cut in November, according to CME FedWatch Tool.
Zero-yield bullion tends to be a preferred investment in a low interest rate environment and during geopolitical turmoil.
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Federal Reserve governor Adriana Kugler stated on Wednesday that she views US monetary policy as “restrictive” and with ongoing disinflation, she believes it is reasonable to consider lowering the policy rate.
Elsewhere, China’s central bank unveiled its biggest stimulus since the pandemic to pull the economy out of its deflationary funk and back towards the government’s growth target.
The intensifying conflict between Iran-backed Hezbollah in Lebanon and Israel also supported gold prices, with cross-border rockets launched by both sides increasing fears of a wider conflict.
Investors will look forward to Federal Reserve chair Jerome Powell remarks due later in the day, along with US inflation data due on Friday.
Meanwhile, Poderosa, one of Peru’s largest gold miners, said on Wednesday that it had faced a fresh attack by “criminals” linked to illegal mining on one of its facilities in the Andean nation, which left a security agent dead.
Spot silver was steady at US$31.86 per ounce, platinum rose 0.7 per cent to US$995.35 and palladium gained 0.7 per cent to US$1,044.72. REUTERS
