Gold prices were flat in early trading on Thursday after the Federal Reserve’s third 75 basis-point interest-rate hike in a row helped boost the dollar and Treasury yields, causing the value of gold to diminish.
Gold for December delivery
was marginally higher, up $1.60 to $1,678 per ounce on Comex.
rose 13 cents, or 0.6%, to $19.61 per ounce.
rose 4 cents, or 1.1%, to $3.51 per pound.
What analysts are saying
The stronger dollar is once again helping to weigh on gold, but geopolitical tensions in Russia — as Russian President Vladimir Putin calls up reservists and re-ups his nuclear rhetoric — are helping to keep the precious metal from substantially weakening.
Also, the fact that the Fed opted not to deliver the 100 basis-point interest-rate hike that some had anticipated was helping keep gold from substantially weakening, said Naeem Aslam, chief market analyst at AvaTrade.
Still, with the dollar on the rise, “the path of the least resistance for gold prices is highly skewed to the downside,” Aslam said.
The ICE U.S. Dollar Index
a gauge of the dollar’s strength against a basket of rivals, was up 0.4% to 111 on Thursday, marking the greenback’s strongest level in more than 20 years.
In Treasury trading, the 2-year yield
has now climbed solidly north of 4%, seen as a level that could unleash stress across markets. The yield has reached its highest level since late 2007.