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Gold futures touch fresh 6-week high before Trump press conference

Published 11/01/2017, 08:21
Updated 11/01/2017, 08:25
© Reuters.  Gold hits fresh 6-week high before Trump
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Investing.com - Gold prices rose to a fresh six-week high on Wednesday, as markets looked ahead to President-elect Donald Trump’s first press conference since his election victory later in the day.

Gold for February delivery on the Comex division of the New York Mercantile Exchange touched a session peak of $1,191.00 a troy ounce, a level not seen since November 30.

It was last at $1,188.35 by 3:20AM ET (08:20GMT), up almost $3.00, or 0.3%, after ending Tuesday's session little changed.

U.S. president-elect Donald Trump takes center stage with his first post-election news conference at 11:00AM ET (16:00GMT) on Wednesday.

Investors will welcome any detail he may give on his promises of tax reform, infrastructure spending and deregulation, as well as insight regarding policies on China and the domestic economy.

Trump has been credited with being a major catalyst behind the market's impressive rally since election day, although he has yet to outline his economic policies in detail.

He will officially take office on January 20.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was steady at 102.10 in early trade, remaining well off last week's 14-year high of 103.82.

Gold has been well-supported in recent sessions after minutes from the Federal Reserve’s December meeting unsettled investors’ expectations about the pace of future interest rate hikes.

A delay in raising interest rates would be seen as positive for gold, a non-interest-bearing asset, and negative for the dollar.

Dollar weakness usually benefits gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies.

The Fed had indicated in December that at least three rate increases were in the offing for 2017, according to a forecast of interest rates from members of the central bank, known as the dot-plot.

However, traders remained unconvinced. Instead, markets are pricing in just two rate hikes during the course of this year, according to Investing.com’s Fed Rate Monitor Tool.

Global financial markets will continue to focus on key U.S. reports in the week ahead, with Friday’s retail sales data in the spotlight.

In addition, there are a handful of Fed speakers on tap, including Chair Janet Yellen on Thursday, as traders look for more clues on the likelihood of higher interest rates later this year.

Also on the Comex, silver futures for March delivery was at $16.85 a troy ounce during morning hours in London, little changed on the day.

Meanwhile, platinum tacked on 0.2% to $984.85, while palladium advanced 0.15% to $766.30 an ounce.

Elsewhere in metals trading, copper futures were little changed at $2.613 a pound.

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