Gold price moves above $1,280/oz as dollar weakens

Gold strengthened in London morning trading on Tuesday November 1 while the dollar softened ahead of a meeting of the US Federal Reserve’s policy board.

The spot gold price was recently quoted at $1,282.35/1,282.65 per oz, up $6.45 on the previous close. Trade has ranged from $1,275.55 to $1,282.78 so far.

“Gold prices are edging higher and it seems more likely that a base has now been established. The halt in the dollar’s rise may well be providing some lift too,” William Adams, an analyst at Metal Bulletin, said. 

The US dollar index was recently at 98.21, down 0.2% on its previous close.

“Given the pullback in gold prices in October after earlier strong gains, we would not be surprised if more physical buying started to emerge now it looks like a base may be in place,” Adams added.

Market participants are now awaiting a meeting of FOMC that starts today and concludes on Wednesday.

Solid manufacturing figures from the US, Europe and Asia has boosted investor sentiment and expectations of a US rate increase this year. But most expect US policymakers to keep the Federal Fund rate unchanged ahead of US presidential elections later this month.

The market currently sees only a 6% chance of a rate increase in November but a 78% chance of a rise in December, according to the CME FedWatch tool.

In central bank news, the Bank of Japan kept interest rates unchanged but cut its fiscal 2017 inflation forecasts to 1.5% from 1.7%. It also pushed back its expectations for hitting 2% inflation to around fiscal 2018, a year later than its previous target of fiscal 2017.

The other precious metals followed gold higher – the spot silver price rose 20 cents to $18.05/18.07 per oz, platinum at $983/988 per oz was up $9 and palladium climbed $6 to $620/628 per oz.

(Editing by Mark Shaw)

 

The post Gold price moves above $1,280/oz as dollar weakens appeared first on The Bullion Desk.

from The Bullion Desk http://ift.tt/2eiazg4
via IFTTT