Gold prices fall as dollar weakens

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Gold prices fall as dollar weakens

On Wednesday, gold went down in range-bound trading, as sustained strength in the dollar kept investors away from the greenback-priced bullion.

Spot gold was down by 0.1% at $1,818. By 0105 GMT, the 74 per ounce was reached. US gold futures fell by 0.1% to $1,820 at the beginning of the day. The US dollar was steady after a sharp gain on Tuesday, making gold less attractive for buyers holding other currencies.

The previous session saw gold prices fall into a tight range due to investors' expectation of higher interest rates and support from recession risks.

The US Federal Reserve policymakers promised more rapid interest rate hikes to bring down high inflation on Tuesday, but they pushed back against growing fears that higher borrowing costs will trigger a steep downturn, according to investors and economists.

While gold is seen as an inflation hedge, higher interest rates and bond yields raise the opportunity cost of holding bullion, which yields no interest.

The US 10-year Treasury yields have slowed, providing some support to gold.

The United States imposed sanctions on more than 100 targets and banned new imports of Russian gold, based on commitments made by the Group of Seven leaders this week to punish Russia over its invasion of Ukraine.

In June, consumer confidence dropped to a 16 month low, as worries about high inflation left consumers to believe that the economy would slow down or even slide into recession in the second half of the year.

Spot silver fell by 0.3% to $20.78 per ounce, while platinum rose 0.6% to $915.72 and palladium gained 0.8% to $1,889.