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Gold hit its lowest level in more than three weeks on Monday morning, weighed down by a stronger dollar and expectations that the Federal Reserve will raise interest rates further to curb soaring inflation.
Spot gold was down 0.11% at $1,743.46 an ounce as of 9.12am UAE time.
In the UAE, 24K prices fell to AED211.25 a gram on Monday morning, down 0.5 AED per gram. Likewise, 22K, 21K and 18K opened at Dh198.5, Dh189.25 and Dh162.25 per gram, respectively.
In the latest Fed comments, St. Louis Federal Bank President James Bullard said he was considering backing a third straight 75 basis point rate hike in September, saying he wasn’t ready to say the economy has gone through its worst. Inflation soared.
“The Fed’s hawkish stance has pushed the dollar to a one-month high against key rivals, making gold more expensive for buyers holding other currencies. Meanwhile, profit-taking near the $1,800 mark has also weighed on the safe-haven Metals. Going forward, all eyes are on the Jackson Hole symposium scheduled for next week, where the Fed’s expected repricing will drive the market,” said Vijay Valecha, chief investment officer at Century Financial.
Technically, a break below $1,750 could open the door to the $1,725-$35 area and then $1,710, he said. On the upside, the $1,775 and $1,800 mark could act as strong resistance. In the UAE, 24K gold is likely to trade between AED207 and AED218 this week.
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