Gold stabilizes as investors await US economic data

Gold settled Thursday, July 6, as investors await a set of US economic data that may affect the course of the US Federal Reserve’s monetary policy, after publishing the minutes of its June meeting, which supported expectations of raising interest rates for a longer period.

By 0241 GMT, gold settled in spot transactions at $1918.59 an ounce, while US gold futures fell 0.1% to $1925.00.

Gold is highly sensitive to rising US interest rates, because their rise increases the opportunity cost of holding the non-yielding metal.

Minutes of the US Federal Reserve meeting showed that it agreed to keep interest rates steady at the June meeting to buy time and assess whether more rate hikes are needed.

Dealers are also closely watching developments regarding Chinese restrictions on the export of two minerals critical to the semiconductor industry ahead of US Treasury Secretary Janet Yellen’s visit to Beijing on Thursday.

“Further escalation on that front after the meeting could put market participants on the defensive,” said Ip Gong Rong, market strategist at IG.

As for other precious metals, silver rose in spot transactions by 0.1% to $23.1292 an ounce, while palladium fell 0.9% to $1248.44, and platinum settled at $915.77.