* Gold faces resistance at $1,800/oz and $1,835/oz – Analyst
* Fed may start reducing stimulus by mid-November – minute (recap, adds comment, updates prices)
October 14 (Businesshala) – Gold prices rose to their highest level in nearly a month on Thursday, supported by a weaker dollar and US bond yields as investors assessed whether the Federal Reserve should tighten its monetary policy as soon as possible. Will do
Spot gold rose 0.3% to $1,797.27 an ounce as of 0920 GMT, having previously hit a high of $1,797.31 since Sept. 15. US gold futures rose 0.2% to $1,797.90.
The dollar and the benchmark US 10-year Treasury yield were both bearish on Thursday. A weaker dollar makes gold cheaper for buyers in other currencies and the low yield reduces the opportunity cost of holding interest-free gold.
Independent analyst Ross Norman described gold’s rally as “constructive” but said it had to break above key technical resistance near $1,800 and $1,835 before another significant move could take place.
Investors took note of data showing record annual rises in prices of Chinese producers last month and a solid rise in US consumer prices, which also raised fears that central banks may reduce their economic support and raise interest rates too soon. can increase.
Minutes of the September meeting of the US Federal Reserve showed that it could start reducing stimulus by mid-November.
But, “now that we’ve got a little bit of visibility into what the Fed intends to do in terms of tapering and that’s a relatively small amount; it’s been a positive for gold,” said Norman, on the taper timeline. Given the uncertainty, the weight of gold was reduced.
While gold is considered a hedge against high inflation, lower central bank incentives and higher interest rates increase the yield of government bonds, increasing the opportunity cost of holding bullion.
Han Tan, Chief Market Analyst at Exinity, said, “Should market participants continue to abandon ‘team transitory’ as fears of stagflation mount, gold prices could hold strong bids out of the safe haven play and a sharp rise in consumer prices.” As a defense against.”
Spot silver rose 0.9% to $23.28 an ounce, platinum rose 1.6% to $1,036.52 and palladium jumped 3.7% to $2,184.26. (Reporting by Nakul Iyer and Eileen Soreng in Bengaluru; Amelia Sithol-Mataris)