Gold rose on Thursday, buoyed by a weaker dollar after minutes from the US Federal Reserve’s July meeting showed policymakers were divided over whether to raise interest rates soon.
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The Fed has met the first goal and is nearing the second, he said. The index was on track to rise 0.25 percent on the week, during which it reached a 1-year high. USA 10-year Treasury notes fell 15/32 in price to yield 1.588 percent.
Strong recent United States jobs growth and a long-awaited return of middle-wage employment are two positive signs for the United States labour market, an influential Federal Reserve policymaker said on Thursday, reinforcing his positive message on the broader economy.
“The market has been trying to read into whether Fed official comments for a September rate hike will be repeated by Janet Yellen next week, but there is no clarity yet”, Saxo Bank senior manager Ole Hansen said.
While the Fed’s hesitation in lifting rates this year has helped boost gold by 27%, recent comments have raised the possibility of a move before year-end.
The index of the dollar against a basket of six major currencies was up about 0.2 percent at 94.296.
Finally, Thursday also saw San Francisco Fed President John Williams state that, “in the context of a strong domestic economy with good momentum, it makes sense to get back to a pace of gradual rate increases, preferably sooner rather than later”.
The dollar sank below the 100 yen mark, falling to 99.94 yen from 100.28.
SINGAPORE/TOKYO – Asian stocks retreated on Friday and the dollar edged up from a near eight-week low after some Federal Reserve officials reiterated the case for raising interest rates in coming months.
The minutes showed “several” policymakers said a slowdown in the future pace of hiring would argue against a near-term hike even as members of the rate-setting Federal Open Market Committee were generally upbeat about the USA economic outlook.
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“The minutes paint a balanced picture and support the market’s view, according to which the likelihood of a small rate step by the end of the year is not even 50 percent”, Commerzbank currency strategist Antje Praefcke said. Dow e-minis 1YMc1 were down 10 points, or 0.05 percent, with 15,322 contracts changing hands.
