Spot gold might test $1,308 -technicals * Silver rises off of 8-wk lows hit earlier * Platinum, palladium bounce off 4-wk lows (updates prices) By Sethuraman N R Aug 25 (Reuters) – Gold on Thursday held slightly above a four-week low touched in the previous session as the dollar lost some strength ahead of a speech by Federal Reserve Chair Janet Yellen that may yield clues on USA interest rate policy.
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Market expectations have increased that Yellen might indicate a clearer timeframe for the next USA rate hike after strong housing data this week and hawkish comments by other Fed officials, but many analysts expect her to strike a more neutral stance.
Taiwan Semiconductor Manufacturing Co. climbed 1.4 percent as Taiwan’s Taiex index rose 0.9 percent.
The dollar index .DXY , which has enjoyed four straight days of gains, fell 0.16 percent as Yellen speech approaches.
Global markets awaited Yellen’s speech in Jackson Hole, Wyoming, on Friday for insight on the USA monetary policy outlook.
“I think people are reading way, way too much into Jackson Hole”, said Kay Van-Petersen, Asia macro strategist at Saxo Capital Markets. While profits so far have been better than feared, companies could come under pressure as wages rise, and the US election could be a source of market turbulence in the fall, he said.
Ian Forrest, analyst at The Share Centre online broker, described the six monthly financials as “impressive”, highlighting positive effects of two major acquisitions. The problem is Wall Street doesn’t see a rate hike in the cards until December at the earliest, putting their portfolios at risk if Yellen shocks the market by turning hawkish and signals the Fed’s getting ready to move. The currency dropped 0.21 per cent on Wednesday.
Turning to Europe. Shares were mostly higher helped by strength in the banking sector.
The Australian dollar was up 0.2 per cent at US$0.7627.
“With 40 hours to go before Janet Yellen’s testimony at Jackson Hole, the dollar has finally caught a bid”, Kathy Lien, managing director of FX strategy at BK Asset Management, said in a note.
In other commodities, the Brent crude oil spot price rose 0.11 percent to $48.99 per barrel, while the Texas light sweet crude slipped 0.06 percent to $46.74 recently on Thursday. The euro was trading at 1.1270 and the pound remains near the top of its trading range at 1.3218.
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US crude was a touch firmer at $46.80 a barrel following a roughly 3 percent drop overnight after an unexpectedly large inventory build in the world’s biggest oil consumer renewed worries about oversupply.
