MELBOURNE - Gold held near a fresh record and silver hit a two-year high as two Federal Reserve officials said they still expect the US central bank to cut rates three times in 2024, buoying the outlook for the precious metals.
Bullion rose to a fresh peak above US$2,288 an ounce before trading little changed, while silver topped US$26 an ounce. San Francisco Fed president Mary Daly and Cleveland counterpart Loretta Mester – both of whom vote on policy decisions in 2024 – said three reductions were likely over 2024, although there is no urgency. Lower rates benefit the non-yielding metals.
Spot gold was up 0.2 per cent to US$2,284.86 an ounce at 1.50pm in Singapore, after touching US$2,288.40. Silver climbed to US$26.5567 an ounce, the highest intraday level since March 2022.
Gold has climbed by almost 11 per cent in 2024, hitting a procession of records in the process, on expectations that lower US interest rates are on the horizon. Still, data showing the US economy remains robust have cast some doubt over the probable timing of any reductions by the Fed.
A fall in open interest suggests short-covering may have contributed to gold’s recent record, according to Ms Suki Cooper, an analyst at Standard Chartered Bank. The absence of a new catalyst driving the metal higher “makes price action more likely to be choppy and prone to corrections,” she said.
Fed chair Jerome Powell is scheduled to speak later on April 3, potentially offering fresh insights into his policy outlook. At the end of the week, non-farm payrolls figures will also be scrutinised, with healthy employment gains expected, according to a Bloomberg survey. BLOOMBERG
