Mumbai, 29 Jul (Commoditiescontrol): Gold prices climbed on Monday, driven by heightened geopolitical tensions in the Middle East and growing expectations of a U.S. interest rate cut in September. Investors are also focusing on the Federal Reserve's upcoming policy meeting later this week.
Spot gold rose 0.3% to $2,391.80 per ounce as of 0205 GMT, while U.S. gold futures increased 0.4% to $2,390.50. The Federal Open Market Committee of the U.S. central bank is set to meet on July 30-31, with rates expected to remain unchanged at 5.25%-5.50%. However, recent softer U.S. jobs data, cooling inflation, and remarks from top Fed officials have led the rate futures market to fully price in a 25 basis-point cut in September.
Key economic data due this week includes the ADP national employment report and the non-farm payrolls report, which are anticipated to influence market sentiment.
Gold, known for its stability as a hedge against geopolitical and economic risks, tends to perform well in a low-interest-rate environment. The recent escalation in the Middle East has further bolstered its appeal. Israel's security cabinet has authorized Prime Minister Benjamin Netanyahu's government to determine the response to a rocket strike in the Israeli-occupied Golan Heights that killed 12 teenagers and children. The attack, which Israel and the United States attributed to the Lebanese armed group Hezbollah, has heightened geopolitical risks.
In addition, top consumer China's gold production using domestic raw materials increased by 0.58% year-on-year to 179.634 metric tons in the first half of 2024, according to the country's Gold Association.
Other precious metals also saw gains: spot silver inched up 0.1% to $27.93 per ounce, platinum rose 0.8% to $942.75, and palladium increased 0.7% to $906.48.
(By Commoditiescontrol Bureau: 09820130172)
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