Johannesburg - Gold snapped a four-day losing streak after Federal Reserve Governor Lael Brainard defused traders’ fears that the US may raise interest rates imminently.
Gold was little changed at $1,328.20 an ounce by 10:45 a.m. in London, according to Bloomberg generic pricing. That ended its longest losing streak in more than two weeks.
There’s no rush to boost rates as inflation and employment aren’t overshooting, Brainard said in a speech Monday that marked the final public statement from a Fed official before the central bank meets to decide policy on September 20-21. Low borrowing costs support gold, which offers no yield.
“Brainard’s comments have managed to put a floor under the market,” Ole Hansen, head of commodity strategy at Saxo Bank, said by phone. “There are tough negotiations going on within the Fed. The risk of a surprise hike cannot be ruled out and you’re still seeing some of that nervousness in the market.”
Precious metal prices have been in thrall to contrasting comments from Fed officials before the policy meeting. Boston Fed President Eric Rosengren said Friday that the economy may overheat if the bank waits too long. The odds of a hike this month is at 22 percent from 30 percent on Friday, futures indicate.
The Labor Department also is due to release US consumer price index data for August on September 16.
In other metals
Silver rose 0.2 percent to $19.15 an ounce. Platinum was little changed at $1,055.77 an ounce while palladium was 0.1 percent higher. Holdings in gold-backed exchange traded funds added 0.6 metric ton to 2 020.3 tons on Monday, data compiled by Bloomberg show.
BLOOMBERG