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Gold hits highest since March 2022
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U.S. dollar index near 2-month low
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U.S. non-farm payrolls to be out on Friday
(Adds comments, updates prices)
By Seher Dareen
April 5 (Reuters) - Gold prices hit their highest since
March 2022 on Wednesday, extending a rally after weaker U.S.
economic readings bolstered bets U.S. interest rates will rise
more slowly.
Spot gold was up 0.1% to $2,022.79 per ounce by 1120
GMT, while U.S. gold futures were unchanged at $2,038.10.
Analysts said gold was well-placed to sustain gains above
the $2,000 level as weaker prospects for interest dilute the
opportunity cost of holding non-yielding gold, which is also a
hedge against inflation and economic uncertainty.
"The 'third time's the charm' for gold, having probed above
the $2,000 level in both August 2020 and March 2022. This time
it appears to be able to sustain the momentum as dark clouds
gather within the economy," independent analyst Ross Norman
said.
He said weaker economic data had shifted the emphasis from
"inflation-busting to saving the wider economy".
Gold rallied 2% on Tuesday after U.S. job openings in
February dropped to the lowest in nearly two years.
The dollar index edged higher, yet still near
two-month lows, making bullion cheaper for buyers holding other
currencies. There has also been an improvement in the gold market mood,
said Carsten Menke, head of Next Generation Research at Julius
Baer in a note, "indicated by the return of short-term
speculative traders and trend followers".
Euro zone recovery gathered pace last month but the upturn was uneven, and the ECB could raise rates by 25 basis points at its May, June and July meetings a Reuters poll found.
While the markets expect a pause on U.S. rate hikes in May, Federal Reserve Bank of Cleveland President Loretta Mester said the central bank likely had more rate hikes ahead, pushing the terminal rate over 5%.
Traders also await economic cues from the U.S. non-farm
payrolls data on Friday.
Silver was down 1.1% to $24.74 per ounce,
platinum gained 0.6% to $1,022.99 while palladium jumped 1.2% to $1,474.73.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ xau ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Seher Dareen in Bengaluru; editing by Barbara Lewis and Jason Neely)
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