Gold prices rise but dollar caps gains – News



Gold prices edged up on Tuesday morning, supported by latent concerns about US inflation, although gains were capped by a firm dollar and expectations that the US Federal Reserve will announce a decrease in its purchases of gold. ‘bonds next month.

Spot gold rose 0.37% to $ 1,759.80 an ounce at 9:15 am UAE time.

In the United Arab Emirates, the prices of precious metals remained unchanged on Tuesday morning. Data from the Dubai Gold and Jewelery Group showed 24K at 212.75 Dh per gram, 22K at Dh200.0, 21K at Dh190.75 and Dh18K at Dh163.5.

“Gold is relatively resilient and all arrows point to stagflation versus economic growth (debate),” said Stephen Innes, managing partner at SPI Asset Management.

However, investors are reluctant to continue the move higher before the September Fed meeting minutes, he told Reuters.

Limiting gold’s gains, the dollar hovered near a one-year high reached last month amid soaring energy prices and expectations that the Fed would soon begin to normalize its policy.

Gold is often seen as a hedge against inflation, but the reduction in central bank stimulus and interest rate hikes tend to drive up government bond yields, resulting in lower government bond yields. higher opportunity cost for holding non-interest bearing bullion.

“The risks of slower growth in the face of higher inflation still call for a sustained strategic allocation to gold amid prevailing low rates,” ANZ Research analysts said in a note, adding that they expected bullion prices to hit $ 1,850 before retreating next year.

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