Gold prices eke out gains
NEW YORK: Gold prices eked out gains on Tuesday, buoyed by a lower dollar, while investors cautiously turned their attention to further developments in Russia-Ukraine peace talks and US tariff policy. Spot gold was up 0.2% at $3,236.94 an ounce as of 1102 GMT. US gold futures gained 0.2% to $3,239.40.
The dollar index was down 0.2% against its rivals, making gold less expensive for other currency holders. 'Main focus of traders in the gold market today is on the optimism around the US-China trade and also on renewed hopes for progress towards peace in the Russia-Ukraine conflict,' Ricardo Evangelista, senior analyst at brokerage firm ActivTrades, said.
'It appears that investors largely shrugged aside the recent downgrade of the US credit rating by Moody's. The scenario appears to be bearish for gold due to a rise in risk appetite but the downside is capped by lingering uncertainty.'
Moody's cut the US sovereign credit rating to 'Aa1' from 'Aaa' on Friday, denting risk appetite and lifting safe-have gold more than 1% in the previous session.
Meanwhile, US President Donald Trump said on Monday that Russia and Ukraine will immediately start negotiations towards a ceasefire. US Federal Reserve officials cautiously took on board the ramifications of the downgrade as well as the unsettled market conditions as they continue to navigate an uncertain economic environment.
Several Fed officials are scheduled to speak later in the day, potentially providing further insight into the economy and the central bank's policy path.
Markets are now pricing in at least 54 basis points of rate cuts this year, with the first one expected in October. 'The gold price is building up to a superzone above $3,200, and as long as the price remains above this threshold, we can start to see further recoveries,' said Carlo Alberto De Casa, external analyst at Swissquote.
Elsewhere, spot silver rose 0.4% to $32.48 an ounce, platinum climbed 1.4% to $1,011.53, and palladium was up 0.4% at $978.33.
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