Gold at new record high for 4th time this week
investmentnews.comGold set another record above $2,300 an ounce on the likelihood the Federal Reserve will cut interest rates this year and sustained demand from central banks.
Bullion touched a peak of $2,304.96 an ounce before trading little changed as investors took comfort in Fed Chair Jerome Powell’s assurance Wednesday that it will likely be appropriate to begin lowering borrowing costs “at some point this year.” Silver hit the highest level in almost three years, then eased. Lower rates are generally positive for non-yielding precious metals.
Gold has been on a tear since mid-February — setting a record each day so far this week — as investors wager that it stands to benefit from the impending pivot by the Fed. Bullion has found additional support from heightened geopolitical risks, including in the Middle East and Ukraine, as well as central-bank purchases.
The latest data compiled by the World Gold Council showed that central banks continued adding to their gold holdings in February, marking the ninth straight month of accumulation. China dominated purchases, with India and Kazakhstan also eager buyers.
Still, gold’s upswing has left some market watchers puzzled, especially as real US rates remained elevated, something that’s typically a headwind for bullion.
“I definitely think if we continue like this, there has to be some sort of an air pocket, or we hit a correction,” said Kyle Rodda, senior market analyst at Capital.Com Inc. “There doesn’t seem to be a particularly good, fundamental reason that is clear and available to everyone to pin the move on.”
Spot gold was steady at $2,296 an ounce at 2:47 p.m. in Singapore following a seven-day rally. That sustained advance has lifted the metal’s 14-day relative-strength index to 81,
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