Gold hovers near two-week high on dollar weakness, US fiscal woes
Gold hovered close to a two-week high on Tuesday, supported by a weaker dollar and concerns over the U.S. fiscal outlook, while investors awaited more U.S. economic data for more clarity on interest rate trajectory.
Spot gold was little changed at $3,339.99 an ounce, as of 0228 GMT. Markets in the U.S. and London were closed on Monday for a holiday.
U.S. gold futures fell 0.8% to $3,339.80.
"At this point, we are seeing some consolidation in gold prices. The market is taking a breather and waiting for the next catalyst," said Kelvin Wong, a senior market analyst, Asia Pacific at OANDA.
"However, market participants are concerned about the widening of that U.S. budget deficit that is a supporting factor for gold prices and that is also driving a dollar weakness as well."
The dollar index eased 0.3% to hover near one-month low against its rivals, making greenback-priced gold more attractive for other currency holders.
The U.S. House of Representatives last week passed a version of Trump's tax-cut bill that is calculated to add about $3.8 trillion to the federal government's $36.2 trillion in debt over the next decade, according to the Congressional Budget Office.
Meanwhile, U.S. President Donald Trump backed away from his threat to impose 50% tariffs on imports from the European Union next month, restoring a July 9 deadline to allow for talks between Washington and the 27-nation bloc to produce a deal.
Investors' focus this week will also be on speeches from a slew of Federal Reserve policymakers and Friday's U.S. core Personal Consumption Expenditures price index, for interest rate clues.
Fed funds futures traders see the U.S. central bank as most likely resuming rate cuts in September.
Elsewhere, spot silver gained 0.1% to $33.38 per ounce, platinum was steady at $1,084.28 and palladium eased 0.3% to $984.25.
Follow Emirates 24|7 on Google News.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The National
3 hours ago
- The National
Best photos of JUNE 01: Mass for the Jubilee of Families in Vatican to Top ten contestants in Miss World Finale
Pope Leo XIV arrives on his pope mobile before celebrating a Mass for the Jubilee of Families in St Peter's Square, at the Vatican. AP Photo
Khaleej Times
3 hours ago
- Khaleej Times
Britain to build billion-pound weapons works as Starmer calls for war readiness
Britain must be ready to fight and win a war against states with advanced military forces, Prime Minister Keir Starmer said as his government announced a £1.5 billion ($2.0 billion) plan to build at least six new weapons and explosives factories. Starmer's warning came a day before he publishes a major review of Britain's military capabilities. The UK and countries across Europe are rapidly trying to boost their defence industries after US President Donald Trump said the continent had to take more responsibility for its own security. "We are being directly threatened by states with advanced military forces, so we must be ready to fight and win," Starmer wrote in an article for The Sun on Sunday newspaper, citing as examples Russia's attack on Ukraine and its co-operation with Iran and North Korea. Defence Minister John Healey announced the munitions investment programme in a BBC interview on Sunday, describing it as "a message to Moscow" as well as a way to stimulate the country's sluggish economy. The Ministry of Defence said it would procure up to 7,000 long-range weapons, built in Britain. The extra investment means Britain will spend around £6 billion on munitions in the current parliament, the MoD said. The Sunday Times reported the government wanted to purchase US-made fighter jets capable of firing tactical nuclear weapons. The MoD did not immediately respond to a request for comment on the report. The Strategic Defence Review, commissioned by Starmer's Labour government shortly after it won power last July, will set out the threats Britain faces and the military equipment and services needed to meet them. Starmer has already committed to raise defence spending to 2.5% of GDP by 2027 and target a 3% level over the longer term. The government has already announced a billion-pound plan to invest in Artificial Intelligence that can be used to enhance battlefield decision-making, and has separately committed to spend an extra £1.5 billion to tackle the poor state of housing for the country's armed forces.
Khaleej Times
3 hours ago
- Khaleej Times
'I am NOT taking drugs!' Musk denies damning report
Elon Musk on Saturday denied a report that he used ketamine and other drugs extensively last year on the 2024 campaign trail. The New York Times reported Friday that the billionaire adviser to President Donald Trump used so much ketamine, a powerful anesthetic, that he developed bladder problems. The newspaper said the world's richest person also took ecstasy and mushrooms and traveled with a pill box last year, adding that it was not known whether Musk also took drugs while heading the so-called Department of Government Efficiency (DOGE) after Trump took power in January. In a post Saturday on X, Musk said: "To be clear, I am NOT taking drugs! The New York Times was lying their ass off." He added: "I tried 'prescription' ketamine a few years ago and said so on X, so this not even news. It helps for getting out of dark mental holes, but haven't taken it since then." Musk first dodged a question about his drug use at a bizarre farewell appearance Friday with Trump in the Oval Office in which the Tesla and SpaceX boss sported a noticeable black eye as he formally ended his role as Trump's main cost-cutter at DOGE, which fired tens of thousands of civil servants. News of the injury drew substantial attention as it came right after the Times report on his alleged drug use. The daily recalled erratic behavior such as Musk giving an enthusiastic Nazi-style salute in January of this year at a rally celebrating Trump's inauguration. Musk said he got the injury while horsing around with his young son, named X, when he told the child to hit him in the face. "And he did. Turns out even a five-year-old punching you in the face actually is..." he added, before tailing off. Later Friday, when a reporter asked Trump if he was aware of Musk's "regular drug use," Trump responded: "I wasn't." "I think Elon is a fantastic guy," he added.
