Gold had its fourth month of gains as U.S. Fed pauses rate hikes. Spot gold has risen over 3% so far this month.
Gold rose to its highest in nine months on Thursday, after the U.S. Federal Reserve paused its monetary tightening cycle. FED’ s decision shrunk the dollar and put bullion on track for its fourth straight monthly gain.
Spot gold was up 0.3% to $1,322.81 per ounce at 1311 GMT, having earlier touched its highest since May 11. U.S. gold futures rose almost 1% to $1,322.50.
Late on Wednesday, the Fed offered no alterations to its interest rate outlook. Instead the Federal Reserve stated that the case for further rate increments had “weakened” in recent weeks.
Gold tends to rise on expectations of lower interest rates, which reduce the opportunity cost of holding non-yielding bullion.
The dollar index fell after the Fed’s cautious statement, making the metal potentially cheaper for holders of other currencies.
However, risks to the global economy remain. Market participants closely track high-level trade talks between the United States and China that began on Wednesday.
The news also propelled world stocks to their best January on record, indicating improved risk appetite, limiting gold’s advance.
Global demand for gold rose 4% last year. A surge in central bank purchases to their highest levels since 1967 helped the precious metal.
Elsewhere, palladium gained 1.5% to $1,382, while platinum rose 0.5% to $818.65.
Silver rose 0.2% to $16.09, having hit its highest since July 2018, at $16.12, earlier in the session.
START TRADINGForex – Commodities – Fourth month of gains for Gold
The Canadian dollar took the top spot against the struggling dollar in January. A combination of strong gains in risky assets and a 15% rally in oil prices boosted appetite.
The dollar index steadied at 95.355, not far from a three-week low of 95.16 hit overnight.
The Australian dollar added 0.3% to $0.7277 after rallying 1.3% on Wednesday, its largest percentage gain since Jan. 4.
The Swiss franc and yen each gained around 0.15% versus the dollar, fetching 108.87 and 0.9923, respectively.
The Sterling steadied on Thursday as Britain prepared to resume negotiations with the EU over the issue of Irish border.
At 0900 GMT sterling was flat against the dollar at $1.3117, not far off a 3-month high of $1.3214. It was flat against the euro, too, at 87.6 pence.
Sources: Reuters, Investing, CNN money
PLEASE NOTE The information above is not investment advice.