Gold steadies near record high as investors await Fed verdict

[BENGALURU] Gold prices hovered near all-time highs on Wednesday (Sep 17) as expectations for a US Federal Reserve interest rate cut later in the day dented the US dollar and US bond yields, boosting demand for the precious metal.

Spot gold held its ground at US$3,690.09 per ounce, as at 9.15 am, after hitting a record high of US$3,702.95 on Tuesday.

US gold futures for December delivery edged 0.1 per cent higher to US$3,727.30.

The US dollar languished near more than two-month low against its rivals, making gold more attractive for other currency holders. The benchmark US 10-year Treasury yields were hovering near more than five-month low.

Data on Tuesday showed US retail sales increased more than expected in August, but a weakening labour market and rising prices because of tariffs pose a downside risk to continued strength in spending.

The US central bank is expected to deliver a quarter-percentage-point interest rate cut later in the day to support the labour market. Remarks from Fed chair Jerome Powell will be closed watched to gauge the pace of further easing.

Lower rates reduce the opportunity cost of holding non-yielding bullion.

US President Donald Trump in a social media post on Monday called for Powell to enact a “bigger” rate cut.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.32 per cent to 979.95 tonnes on Tuesday, from 976.80 tonnes on Monday.

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Elsewhere, spot silver eased 0.1 per cent at US$42.50 per ounce, platinum gained 0.4 per cent to US$1,395.75 and palladium rose 0.6 per cent to US$1,183.09.

India’s silver imports are expected to gather momentum in the coming months, supported by stronger investment and industrial demand that has already absorbed the surplus from last year’s elevated shipments, industry officials told Reuters. REUTERS