Gold near 7week high as traders see delay in US rate hike

first_imgGold was trading near its highest in seven weeks on Monday, bolstered by expectations the Federal Reserve will not hike U.S. interest rates soon.FUNDAMENTALS* Spot gold was little changed at $1,156 an ounce by 0043 GMT, after gaining 1.6 percent in the previous session.* The metal climbed to $1,159.80 on Friday, its highest since Aug. 28, after minutes from the Fed’s September policy meet showed that the central bank was deeply cautious about tightening monetary policy.* Weakness in the dollar, which fell to a three-week low on Friday, also helped support gold. [USD/]* A delayed rate rise could support non-interest-paying gold, although uncertainty over the timing could weigh on prices in the near term.* Two influential Fed policymakers on Friday reinforced Fed Chair Janet Yellen’s message that a rate hike is coming by year’s end.* Fed policymakers are still likely to raise rates this year but that is “an expectation, not a commitment”, and could change if the global economy pushes the U.S. economy further off course, Fed Vice Chairman Stanley Fischer said over the weekend.* Recent weak U.S. data and concerns over the global economy have prompted many to believe the first U.S. rate hike in nearly a decade will not come this year.* Hedge funds and money managers raised their bullish bets in COMEX gold and silver to four-month highs in the week ended Oct. 6, data on Friday showed, amid expectations the Fed will delay a much-anticipated rate hike.* Elsewhere, the London Bullion Market Association said on Friday it has formally asked exchanges and technology firms to bid for services such as a gold exchange or a clearing platform to make the London market more transparent and liquid.* South Africa’s Association of Mineworkers and Construction Union voted on Sunday to strike at the operations of AngloGold Ashanti, Harmony Gold and Sibanye Gold.* Among other precious metals, platinum eased 0.2 percent to $976.99, but wasn’t too far from a three-week high of $983 reached in the previous session.* Palladium was down 0.4 percent on Monday after climbing to a near-four-month high of $722 on Friday.* Trading activity during Asian hours is likely to be thinner than usual with Japanese markets closed for a public holiday. U.S. markets will also be shut on Monday for a holiday.last_img

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