InfoQuest – Gold futures in New York closed higher on Friday (August 16), supported by a weaker dollar amid growing expectations that the US Federal Reserve is set to cut interest rates in September. Tensions in the Middle East also boosted demand for gold.
The Comex gold contract for December delivery rose $45.40, or 1.82%, to close at $2,537.80 an ounce. It is up 2.8% this week.
Silver contract for December delivery. The stock price rose $0.436, or 1.51%, to close at $29.264 per ounce.
Platinum contract for October delivery. Gold fell $2.70, or 0.28%, to close at $962.40 an ounce.
Palladium for September delivery rose $6.70, or 0.72%, to close at $943.60 an ounce.
The dollar index fell 0.4 percent, extending its fourth weekly decline, making gold attractive to investors holding other currencies.
Federal Reserve Chairman Jerome Powell is scheduled to deliver a speech on the economic outlook next Friday, the first day of the Kansas City Fed's annual economic meeting in Jackson Hole, Wyoming.
Producer Price Index (PPI) and Consumer Price Index (CPI) for July are due out this week. This suggests that inflation in the US is declining. This could make it more likely that the Federal Reserve will cut interest rates by 0.25% next month.
The U.S. economy is showing no signs of overheating, so central bankers should be wary of keeping policy tight for too long, said Chicago Fed President Auston Goolsbee.
“The ongoing geopolitical conflicts and the potential escalation of conflicts that Iran may be involved in, including the war in Ukraine, are all factors that are impacting demand for gold as a safe haven asset,” said Everett Millman, senior market analyst at Gainesville Coin.