Lower rates are typically a positive for gold, as it doesn’t pay interest.
The precious metal has climbed more than a quarter this year and hit record levels, supported by US monetary easing, safe-haven demand, and buying by the world’s central banks. However, the rally eased after the election of Donald Trump, which boosted the dollar. A stronger greenback makes commodities priced in the currency more expensive for most buyers.
Spot gold was up 0.4% at US$2,632.17 an ounce at 7:34 am in London, after falling 1% last week. The Bloomberg Dollar Spot Index was flat, following a 0.6% weekly gain. Platinum and silver rose over 1%, while palladium advanced 0.7%.
