GOLD prices clung to a three-month peak on Tuesday (Mar 5), supported by softer United States manufacturing and construction spending, while investors awaited Federal Reserve chair Jerome Powell’s testimony and key jobs data due this week.
Spot gold edged 0.1 per cent lower to US$2,112.39 per ounce, as at 0230 GMT, but hovered near Monday’s levels of US$2119.69, its highest since Dec 4. US gold futures fell 0.3 per cent to US$2,120.50.
London’s gold price benchmark hit an all-time high of US$2,098.05 per troy ounce at an afternoon auction on Monday, surpassing the previous record of US$2,078.40 set on Dec 28, the London Bullion Market Association said.
Market focus is on Fed chair Powell’s two-day congressional testimony on Wednesday and Thursday.
Other economic releases due this week that could move the needle on US rate cut expectations include Institute for Supply Management services data at 1500 GMT, and the Job Openings and Labor Turnover Survey on Wednesday, and the non-farm payroll report on Friday.
Data last week showed US manufacturing slumped further in February and inflation gradually easing, while consumer sentiment stood weak.
The Fed is under no urgent pressure to cut rates given a “prospering” economy and job market, Atlanta Fed president Raphael Bostic said on Monday in remarks that highlighted the risk inflation may get stuck above the central bank’s 2 per cent target or be sent even higher by “pent-up exuberance”.
Traders now see a 65 per cent chance for a June US rate cut, according to LSEG’s interest rate probability app.
Lower interest rates boost the appeal of non-yielding bullion.
Spot platinum fell 0.7 per cent to US$890.90 per ounce, and palladium dropped nearly 1 per cent to US$951.12, while silver fell 0.9 per cent to US$23.68. REUTERS
