Gold steadied following Friday’s dip as investors assess the path for US interest rates next year.
The precious metal fell 0.8% on Friday, trimming a weekly gain, after New York Fed President John Williams said it’s premature for officials to begin thinking about cutting borrowing costs. Atlanta Fed President Raphael Bostic told Reuters he expects rate cuts starting in the third quarter of next year. Lower rates are positive for non-interest bearing gold.
Meanwhile, Goldman Sachs Group Inc. said a more dovish Fed and a weaker dollar could help lift gold prices. The bank raised its 12-month target to $2,175 an ounce, according to a note on Monday. Strong retail demand in India and China should also help underpin gains, it said.
Elsewhere, European Central Bank Governing Council member Madis Muller said Friday that markets were getting ahead of themselves in betting on lower borrowing costs in the first half of next year, while ECB President Christine Lagarde said the bank had not discussed rate cuts at all.
Gold rose 0.2% to $2,022.83 an ounce as of 5:40 a.m. in London. The Bloomberg Dollar Spot Index was little changed. Silver, platinum and palladium also rose.
Source : Bloomberg
