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Gold Drops to Weekly Low on Rising Dollar

Gold eased to a one-week low on Thursday, as a recovery in the dollar and improved appetite for riskier assets pushed investors away from bullion.

Spot gold fell 0.13 percent to $1,224.09 per ounce, after touching its lowest since Nov. 1 at $1,219.59 earlier in the session.

U.S. gold futures for December delivery settled down $3.60 at $1,225.10 per ounce. The dollar rose more than half a percent against a basket of currencies.



“Gold is unquestionably dollar-watching, and by extension looking at the (interest) rates,” said Ross Norman, chief executive officer of Sharps Pixley. “The market is drifting a little lower today on expectations of further rate hikes. If the rates go higher, it is a slightly negative story for gold.”

The Federal Reserve kept interest rates unchanged, as expected. Although the Fed kept rates steady, market participants looked for clues about possible rate increases in December and in 2019.

Higher interest rates raise the opportunity costs of holding gold, which earns nothing and costs money to store and insure.

via CNBC

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