Gold Price Today, August 17: Gold prices edged higher on Monday, August 17, holding close to the USD 4,440-per-ounce level and remaining on track to rise for the second consecutive session. The precious metal was supported by weakness in the US dollar, which typically makes bullion more attractive to foreign buyers.
Gold Price Today: Spot gold, silver prices
As of 5:55 am IST, spot gold was up 0.3 per cent, or USD 11.5, at USD 4,388.07 per ounce. Gold prices had ended the previous session on a positive note on Friday, August 14, marking their second consecutive rise.
Meanwhile, spot silver prices were up 0.8 per cent, or USD 0.5, at USD 65.2 per ounce.
In the domestic market, gold and silver futures on the Multi Commodity Exchange (MCX) are scheduled to start trading at 9:00 am. In the previous session, gold and silver futures settled at Rs 1,54,590 per 10 grams and Rs 2,36,272 per kg, respectively.
US dollar weakness supports gold prices
The US dollar index, which tracks the greenback against a basket of six major currencies, was trading about 0.2 per cent lower at 99.53. A weaker US dollar usually makes gold more attractive to foreign buyers, contributing to higher demand for bullion.
Additional support came from softer US economic data, which weighed on expectations around the Federal Reserve’s interest-rate trajectory.
US retail sales data released on Friday showed that retail sales in July fell 0.6 per cent month-on-month to USD 763.6 billion, compared with a consensus estimate for a 0.1 per cent rise.
Softer US inflation data boosts gold’s appeal
Last week’s consumer price index (CPI) readings showed a deceleration in annual headline and core inflation figures in July. Thursday’s producer price index (PPI) data echoed a similar trend, with annual headline and core indexes rising at a slower pace.
Softer-than-expected US retail sales, CPI and PPI data reinforced expectations of a less aggressive Federal Reserve rate path. This boosted gold’s appeal as lower interest rates reduce the opportunity cost of holding the non-yielding precious metal.
Fed rate expectations in focus
Expectations for a Fed rate hike fell to nearly 33 per cent, compared with about 45 per cent last week. Lower expectations of Fed rate hikes supported gold prices, as a lower interest-rate environment reduces the opportunity cost of holding the non-yielding precious metal.
The upcoming data and FOMC minutes will also be closely watched for clues about the Federal Reserve’s interest-rate trajectory and its potential impact on precious metals prices.
