On Tuesday, gold saw a modest increase driven by a weaker dollar, but its movement remained limited as traders positioned themselves ahead of Federal Reserve Chair Jerome Powell’s speech and upcoming economic data that could provide insights into future interest rate hikes. By 9:27 a.m. EDT (1327 GMT), spot gold had risen by 0.3% to reach $1,927.94 per ounce, marking its third consecutive daily gain. Meanwhile, U.S. gold futures also experienced a 0.2% increase, reaching $1,937.70.
Bob Haberkorn, senior market strategist at RJO Futures, noted that gold finds itself caught between a stronger-than-expected durable goods figure, which supports the likelihood of a 0.25% rate hike by the Fed, and a weaker dollar. In May, new orders for crucial U.S.-manufactured capital goods unexpectedly rose, although data from the previous month was revised downward. The dollar index (DXY) declined by 0.3%, making dollar-denominated gold more appealing for foreign buyers.
In the previous session, gold prices inched up due to concerns arising from a brief mutiny in Russia. However, Commerzbank analysts highlighted that the crucial question for gold is the potential impact of internal tensions within Russia or any potential government changes on global monetary policy.
Gold has experienced a decline of approximately 1.7% this month, putting it on track for a second consecutive monthly decrease if losses persist. The diminished appeal of the zero-yielding asset resulting from expectations of higher U.S. interest rates has overshadowed its traditional safe-haven role to some extent.
Investors eagerly awaited Jerome Powell’s forthcoming speech and a significant amount of key economic data scheduled for release on Thursday. According to Haberkorn, gold may experience sideways trading and a lack of clear direction until then, unless any unexpected events unfold.
Spot silver registered a 1.3% increase, reaching $23.05 per ounce, and was heading for its third consecutive session of gains. Platinum rose marginally by 0.05% to $924.66, while palladium saw a 0.4% rise, reaching $1,311.40.
