Gold Hovers Below 15-Month Peak as Dollar Firms on US Rate Talk

Gold prices gained 21 percent since the start of the year as the Fed slowed its expected pace of rate increases.

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1 min read
Gold prices hit a one-year high on Tuesday. (Photo: iStockphoto)

Gold nursed losses on Wednesday, holding below a 15-month high as the dollar firmed after two Federal Reserve officials talked up US interest rate hikes this year.

The United States could see two further interest rate rises this year, Atlanta Fed President Dennis Lockhart said on Tuesday.

San Francisco Fed President John Williams said Tuesday that he would support an interest-rate hike in June as long as he sees continued progress on the economy, inflation and jobs.

The dollar index finished Tuesday’s session up 0.3 percent after hitting a 15-month low earlier in the session, recording its first increase in seven days.

Earlier this week, gold had climbed to $1,303.60, its highest since January 2015, after the dollar slumped against the yen.

Gold prices have gained 21 percent since the start of the year on the outlook that the Fed has slowed its expected pace of rate increases. Bullion is sensitive to rising interest rates, which lift the opportunity cost of holding non-yielding bullion.

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