Gold prices rise on weaker dollar as Fed minutes cool rate hike expectations

By: | Published: August 18, 2016 9:25 AM

Gold prices rose for a fourth day on Thursday on a weaker dollar after minutes from the U.S. Federal Reserve's July meeting showed several members were cautious on hiking interest rates soon.

Spot gold was up 0.3 percent at ,351.54 an ounce at 0106 GMT. U.S. gold climbed 0.6 percent to ,356.70 an ounce.(Reuters)Spot gold was up 0.3 percent at ,351.54 an ounce at 0106 GMT. U.S. gold climbed 0.6 percent to ,356.70 an ounce.(Reuters)

Gold prices rose for a fourth day on Thursday on a weaker dollar after minutes from the U.S. Federal Reserve’s July meeting showed several members were cautious on hiking interest rates soon. The minutes showed that members of the Fed’s rate-setting Federal Open Market Committee were generally upbeat about the U.S. economy and labour market, but several said any slowdown in future hiring would argue against a near-term hike.

Spot gold was up 0.3 percent at $1,351.54 an ounce at 0106 GMT. U.S. gold climbed 0.6 percent to $1,356.70 an ounce. The dollar sagged on Thursday and the yen firmed 0.4 percent to 99.87 yen per dollar. The index of the dollar against a basket of six major currencies last stood at 94.622, hovering near Tuesday’s seven-week low of 94.426 and having lost over 1 percent so far this week.

The number of people claiming unemployment benefit in Britain unexpectedly fell in July despite the shock decision by voters to leave the European Union, suggesting little immediate impact from Brexit on the labour market.

Japan’s exports tumbled in July at the fastest pace since the global financial crisis with a resurgent yen and weakness in overseas economies weighing on overseas shipments – a warning that Japan cannot rely on exports to drive growth. Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.46 percent to 957.78 tonnes on Wednesday. CME on Wednesday lowered COMEX 100 Gold Futures (GC) maintenance margins for speculators by 10 percent to $5,400 per contract from $6,000 for August and September 2016.

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