|
Spot gold advanced 0.8% to $1,942.61 per ounce by 1023 GMT,
having gained about 1% earlier in the session. U.S. gold futures
rose 1.8% to $1,943.30.
The U.S. central bank on Wednesday raised interest rates by 25
basis points, but the expected hike appears to have failed to
ease inflation worries, keeping gold's appeal as an inflation
hedge intact.
"It's sell the rumour, buy the fact," as gold moves forward with
the bad news priced in, independent analyst Ross Norman said.
"Although counter-intuitive as raising rates should be negative
for gold, it authenticates the claim that we've got an inflation
problem."
Rising U.S. interest rates tend to increase the opportunity cost
of holding non-yielding, greenback-priced bullion.
Although the Fed laid out an aggressive plan to push borrowing
costs next year, the dollar and yields on 10-year U.S. Treasury
notes eased, with investors seemingly having priced in an even
stronger rate hike, boosting gold. [USD/] [US/]
The Fed's "meek" response to soaring inflation helped gold, said
Brian Lan, managing director at dealer GoldSilver Central.
"People will see that it is still good to hold gold because .25%
doesn't even rock the boat."
Analysts have also said investors in safe-haven gold will
continue to closely track political and economic risks posed by
Russia's invasion of Ukraine, which has entered its fourth week.
Meanwhile, "if you had to look at one single thing to encourage
you that this bull run has got legs, you'd be looking at ETF
flows and that's really positive," Ross Norman said.
Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust, rose 0.8% to the highest since March 2021
at 1,070.53 tonnes on Wednesday. [GOL/ETF]
Spot silver climbed 1% to $25.31 per ounce, while platinum rose
0.4% to $1,021.64. Palladium added 2.6% to $2,471.57.
(Reporting by Bharat Govind Gautam in Bengaluru; Editing by
Vinay Dwivedi)
[© 2022 Thomson Reuters. All rights
reserved.]
This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
|
|
