Gold climbs on weaker dollar, rate outlook
Gold prices were up for the fourth straight session on Monday, hitting a hit a fresh two-week high, as the dollar extended losses and expectations rose that the U.S. Federal Reserve won’t hike interest rates before September.
Spot gold was last at $1,185.70/1,186.50 per ounce, up $3.60 on the pre-weekend close. It hit its highest since March 6 earlier in the session at $1,189.30.
“The market has been in a back-and-forth motion for the last couple of weeks, caught between the potential for rising interest rates and its impact on the dollar and the feeling by investors that the economy is gaining some strength,” Rick Meckler, president of hedge fund LibertyView Capital Management in Jersey City, New Jersey, told Reuters.
The U.S. Fed Reserve lowered last week its estimates for where borrowing costs will be at the end of 2015 to 0.625%, from December’s estimate of 1.125%. Traders and analysts had been exiting precious metals in anticipation of more significant rate gains, which usually send investors to assets with better yield prospects such as equities and bonds.