Gold futures rise on weaker U.S. dollars

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Gold futures on the COMEX division of the New York Mercantile Exchange rose on Monday as the U.S. dollar weakened.

The most active gold contract for February delivery rose 11.5 U.S. dollars, or 0.98 percent, to settle at 1,184.90 dollars per ounce.

Gold was given support as the U.S. Dollar Index fell by 0.24 percent to 101.99 as of 1845 GMT. The index is a measure of the dollar against a basket of major currencies.

Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

The U.S. Dow Jones Industrial Average fell as well, decreasing by 0.38 percent, or 76.42 points as of 1845 GMT. Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.

Although no major economic data was released on Monday, investors are still maintaining a certain level of awareness of the Fed’s thinking on interest rates.

Investors believe the Fed may raise rates from 0.75 to 1.00 during the March FOMC meeting at the earliest. According to the CME Group’s Fedwatch tool, the current implied probability of a hike from 0.50 to at least 0.75 is at 3 percent at the February meeting and 24 percent for the March meeting.

Silver for March delivery rose 16.4 cents, or 0.99 percent, to close at 16.683 dollars per ounce. Platinum for April delivery added 12 dollars, or 1.24 percent, to close at 982.60 dollars per ounce. Enditem

Source: Xinhua/NewsGhana.com.gh

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