Gold steadied as investors remained uncertain over the size of the Federal Reserve’s looming interest rate hikes, which could put renewed pressure on the precious metal.
Bullion, which hovered above $1,700 an ounce for the first half of September, plunged below that mark last week. While it has since steadied, a move by the Fed on Wednesday to bump up rates by as much as 100 basis points to counter rampant inflation could trigger another slide in the non-interest bearing precious metal.
Gold is “demonstrating resilience” ahead of the Fed’s interest-rate decision, Yamana Gold executive chairman Peter Marrone said in a Bloomberg Television interview. He saw Asian buyers helping prices, including strong support from countries like India as well as China, where gold jewelry purchases have been crimped by Covid outbreaks.
Longer term, bullion enthusiasts at the annual Denver Gold Forum this week are optimistic. Prices will reach $1,806.10 an ounce by year-end, according to the average estimate in a survey of 10 participants at the industry’s biggest annual gathering. The forecast is 7.8 per cent above Monday’s spot closing price, and the last time gold settled that high was at the beginning of July.
Spot gold was little changed at $,1674.81 an ounce at 9.33am in Singapore. The Bloomberg Dollar Spot Index was also steady. Silver and palladium slipped, while platinum was gained.