ALSO READGold steady amid expectations for further U.S. rate hikes Gold at 2-week high as cloudy U.S. rate hike outlook drags on dollar Gold hits three-week low; strong dollar, Fed rate hike view weigh Gold hits over three-week low; strong dollar, Fed rate hike view weigh Gold inches up as prospects for slower U.S. rate hikes weigh on dollar
By Sethuraman N R
(Reuters) - Gold prices inched down on Monday after the dollar firmed on expectations of further U. S. interest rate hikes this year.
Spot gold was down 0.1 percent at $1,317.60 an ounce at 0711 GMT. Last week, the metal touched its highest since Sept. 15 at $1,325.86.
Spot gold posted its fourth consecutive weekly gain last week.
U. S. gold futures slipped 0.3 percent on Monday at $1,318.80 an ounce.
"While there could be some downside pressure from a possible U. S. dollar correction, gold will likely remain firm until a March Fed hike possibility comes on the radar," Innes said.
The U. S.
December non-farm payrolls report on Friday was weaker than expected, but investors reckoned the U. S. Federal Reserve would still raise interest rates multiple times this year, although at a gradual pace.
The dollar's index against a basket of six major currencies rose 0.2 percent to 92.155 on Monday, up from its Jan. 2 low of 91.751, which was its weakest level since Sept. 20.
Gold is highly sensitive to rising U. S. interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.
Meanwhile, hedge funds and money managers raised their net long positions in COMEX gold in the week to Jan. 2, U. S. Commodity Futures Trading Commission (CFTC) data showed on Friday.
"Prices should see $1,340 (in the near term) and if it does not breach that gold should look to ease back below $1,300."
Among other precious metals, spot silver inched 0.6 percent lower to $17.12 an ounce, after having hit a 1-1/2-month high on Friday at $17.29.
Platinum dipped 0.3 percent to $966.50 an ounce, after hitting a more than 3-1/2-month top at $970.5 earlier in the session.
Palladium rose 0.5 percent to $1,096 an ounce. The metal hit a record high of $1,105.70 last week.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)