August 8, 2022

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Gold prices tick lower on dollar strength

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Gold inched down on Wednesday in

range-bound trading, as sustained strength in the dollar kept

investors away from greenback-priced bullion.

FUNDAMENTALS

* Spot gold was down 0.1% at $1,818.74 per ounce by

0105 GMT. U.S. gold futures also eased 0.1% to $1,820.30.

* The U.S. dollar was steady after sharp gains on

Tuesday, making gold less attractive for buyers holding other

currencies.

* Gold prices were hemmed into a tight range in the previous

session as investors were caught between pressure from prospects

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of higher interest rates and support from recession risks.

* U.S. Federal Reserve policymakers promised further rapid

interest-rate hikes to bring down high inflation on Tuesday, but

pushed back against growing fears among investors and economists

that sharply higher borrowing costs will trigger a steep

downturn.

* Although gold is seen as an inflation hedge, higher

interest rates and bond yields raise the opportunity cost of

holding bullion, which yields no interest.

* Benchmark U.S. 10-year Treasury yields eased, providing

some support to gold.

* The United States imposed sanctions on more than 100

targets and banned new imports of Russian gold, acting on

commitments made by the Group of Seven leaders this week to

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further punish Russia over its invasion of Ukraine.

* U.S. consumer confidence dropped to a 16-month low in

June, as worries about high inflation left consumers to

anticipate that the economy would slow significantly or even

slide into recession in the…

Reuters

2022-06-28 21:25:03

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