Gold Price Today, September 1: Gold prices edged higher on Tuesday, September 1, supported by a weaker US dollar, which made the dollar-denominated yellow metal more attractive to overseas buyers. However, gains remained capped by elevated crude oil prices and expectations around US interest rates.
As of 6:00 am, spot gold was up 0.2 per cent, or USD 9, at USD 4,457.77 an ounce. The rise comes after bullion prices slipped to a near two-week low in the previous session following hawkish comments from US Federal Reserve Chair Kevin Warsh.
Spot silver also gained, rising 0.4 per cent, or USD 0.30, to around USD 67 an ounce.
MCX Gold, Silver Price Today
In the domestic market, gold and silver futures were not trading at the time of writing. On Monday, gold futures on the Multi Commodity Exchange (MCX) settled at Rs 1,54,456 per 10 grams, while silver futures ended at Rs 2,33,977 per kg.
Gold Price Today: US Dollar supports bullion
The US dollar index, which tracks the greenback against a basket of six major currencies, was trading 0.1 per cent lower at 99.38.
A weaker dollar generally supports gold prices by making the metal cheaper for buyers holding other currencies. Since gold is priced in dollars and does not offer a yield, a softer greenback can also increase its appeal as a store of value.
Gold Price Outlook: Crude oil, Fed rate bets in focus
The upside in gold prices was, however, limited by rising energy prices, with crude oil trading above USD 91 a barrel.
Higher energy prices can add to inflationary pressures and potentially reinforce expectations of higher interest rates. Rising bond yields can reduce the appeal of gold, which does not generate interest or income.
According to the CME FedWatch Tool, markets were pricing in more than a 65 per cent probability of a rate hike at the September FOMC meeting. Rate expectations rose sharply after Warsh’s remarks at the Jackson Hole Symposium on Friday.
Higher interest-rate expectations tend to weigh on gold because the opportunity cost of holding the non-yielding asset increases as yields on interest-bearing investments rise.
Gold Price Forecast: US jobs data, Middle East tensions in focus
Besides movements in the US dollar, interest-rate expectations and crude oil prices, investors will track geopolitical developments in the Middle East for further direction.
Market participants will also focus on upcoming US economic data, including weekly jobless claims and the employment report, along with other indicators that could influence the Federal Reserve’s monetary-policy outlook.
For gold traders, the combination of US interest-rate expectations, dollar movement, crude oil prices and geopolitical tensions is likely to remain key to the bullion market’s near-term direction.
