Gold price edges higher as dollar strength eases

Gold was trading in positive territory on the morning of Monday December 19 in London, continuing the recovery that started on Friday.

The spot gold price was recently quoted at $1,139.00/1,139.30 per oz, up $3.90 on the previous close. Trade has ranged $1,137.75-1,142.40 so far.

Gold is finding support from slightly declining bond yields and a marginally weaker US dollar, Commerzbank noted.

Some market participants may also have been taking advantage of the low price level to buy gold, especially given that the metal is oversold from a technical point of view, the bank added.

The precious metal has been under siege since last week’s Fed rate rise. It now appears to have found a base; however, upside will be limited while investors look to other markets for yield, ANZ noted.

The US Federal Reserve raised the federal funds rate by 25 basis points to 0.5-0.75% last week – the increase is a first since December 2015 – while also suggesting three rate increases in 2017 compared with two previously.

In the other metals, spot silver was recently quoted at $16.065/16.085 per oz, unchanged from the previous close. Platinum edged $1 higher to $920/925 per oz and palladium fell $8 to $683/688 per oz.

(Editing by Wei Jun Lau)

 

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