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Dollar, yields highest since early January
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Palladium hits over 1-year low
(Updates details, prices)
By Seher Dareen
Feb 6 (Reuters) -
Gold edged higher on Monday, with investors banking on the
precious metal's safe-haven appeal as concerns about an economic
slowdown linger, after a stronger dollar and higher Treasury
yields nudged prices to a one-month low.
Spot gold was up 0.2% to $1,868.96 per ounce by
2:37 p.m. ET (1937 GMT). Earlier in the session, prices slipped
to $1,860, their lowest since Jan. 6.
U.S. gold futures settled 0.2% higher at $1,879.50.
"Traders will look at gold as a safe-haven asset and buy into it," said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.
Concerns over a slowdown remain and is likely to keep
demand for gold on a firm footing this year, analysts said.
The dollar index advanced to an almost month-high,
making gold more expensive for buyers holding other currencies. Benchmark Treasury yields also firmed, likely keeping
some investors away from bullion. Gold prices dropped more than 2% on Friday after data showed
U.S. job growth accelerated sharply last month, with focus on
speeches by a host of Fed officials this week, including
Chairman Jerome Powell.
The Fed last week increased interest rates by a quarter of a
percentage point to 4.5%-4.75% after a year of larger hikes, and
investors are now pricing in the policy rate peaking at 5.05% in
June. Gold benefits from low interest rates, which reduce the
opportunity cost of holding the zero-yield asset.
Spot silver dropped 0.4% to $22.26 per ounce, and
platinum slipped 0.2% to $971.70.
Palladium was down 1.2% to $1,604.09 per ounce, after it fell more than 4% earlier to $1,556.53, its lowest since mid-December 2021.
"Among platinum group metals, supply disruptions in South Africa due to a deepening energy crisis should help to stabilise prices in the short term," ANZ wrote in a note. (Reporting by Seher Dareen in Bengaluru; Additional reporting Arundhati Sarkar and Bharat Govind Gautam; Editing by Shounak Dasgupta, Krishna Chandra Eluri and Shailesh Kuber)
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