Staff of Reuters 3 Minutes to Read Reuters, June 29 – Gold prices fell on Tuesday, as a stronger dollar made bullion more expensive for holders of foreign currencies, and fears that the US Federal Reserve will tighten its monetary policy sooner than expected dampened demand. Although gold is seen as an inflation hedge, a Fed rate hike will raise the opportunity cost of storing bullion, reducing its appeal. As of 0100 GMT, spot gold was down 0.2 percent at $1,775.42 per ounce. Gold futures in the United States declined 0.2 percent to $1,776.40. The dollar index rose 0.1 percent against its peers. President Thomas Barkin of the Federal Reserve Bank of Richmond said on Monday that the Fed has achieved “significant more progress” toward its inflation goal, allowing it to begin decreasing asset purchases. * The supply chain mismatches and greater demand that are presently driving up prices are temporary, and the Fed has the ability to respond if inflation continues to rise for longer than expected, according to Fed Vice Chair for Supervision Randal Quarles. Policymakers at the European Central Bank began a public debate on Monday over ending emergency bond purchases that were undertaken at the outset of the coronavirus outbreak last year, with rifts already forming between so-called hawks and doves. Bullion has a tendency to lose favor when monetary policy tightens. According to an official, Zimbabwe’s central bank will allow large-scale gold mining businesses to directly export a portion of their bullion. China’s net gold imports through Hong Kong more than halved in May from the previous month, when they hit a three-year high, as demand slowed due to new coronavirus-related limitations. The world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, reported a 0.3 percent increase in holdings to 1,045.78 tonnes on Monday, up from 1,042.87 tonnes on Friday. Palladium down 0.1 percent to $2,683.19. Silver fell 0.2 percent to $26.03 per ounce. The price of platinum remained stable at $1,090.33. EVENTS/DATA (GMT, June) 0600 UK Time Zones Price of a home Final 1200 Germany CPI, HICP Prelim YY 1400 US Consumer Confidence MM, YY 0900 EU Consumer Confidence (Reporting by Sumita Layek in Bengaluru, Editing by Sherry Jacob-Phillips) Continue reading
