Gold climbed on Thursday, supported by a softer dollar, but gains were capped by a hawkish Federal Reserve, which has limited hopes for near-term rate cuts.<\/p>\n
Peter M. Fisher | The Image Bank | Getty Images<\/p>\n
Gold\u00a0prices rose on Thursday after briefly touching a more than one-month low, as a softer dollar offered support, but gains were capped by a\u00a0hawkish\u00a0Federal Reserve<\/a>,\u00a0which has\u00a0limited hopes for near-term rate cuts.<\/p>\n Spot\u00a0gold<\/a>\u00a0added 0.8% to $4,856.82 per ounce as of 0115 GMT, after falling to its\u00a0lowest since February 6 earlier in the day. Prices fell 3.7% on Wednesday.<\/p>\n U.S.\u00a0gold\u00a0futures<\/a>\u00a0for April delivery shed 0.8% to $4,858.60.<\/p>\n The dollar eased, making greenback-priced bullion cheaper for holders of other currencies.<\/p>\n “The dollar’s momentum has paused today, which has effectively allowed\u00a0gold\u00a0to start recouping ground, albeit at a modest pace,” said Tim Waterer, KCM Trade chief market analyst.<\/p>\n “Expectations for incoming U.S. rate cuts have been a cornerstone of\u00a0gold’s ascent, but spiking oil prices have dampened hopes for monetary easing, which has somewhat pulled the rug out from under the\u00a0gold\u00a0price.”<\/p>\n Oil climbed above $110 a barrel after Iran attacked several energy facilities across the Middle East following a\u00a0strike\u00a0on its South Pars gas field, adding fresh inflation concerns.<\/p>\n The closure of the Strait of Hormuz kept crude elevated, raising transport and manufacturing costs. While\u00a0a rising\u00a0inflation backdrop typically boosts\u00a0gold’s appeal as a hedge, high interest rates reduce demand for the non-yielding metal.<\/p>\n The U.S. Federal Reserve and Bank of Canada both struck\u00a0hawkish\u00a0tones on Wednesday as surging energy prices arising from the Iran conflict clouded the inflation outlook.<\/p>\n Both central banks held rates steady, but warned of risks that rising energy costs could fan a more persistent inflation spike.<\/p>\n Meanwhile, U.S. President Donald Trump’s administration is considering\u00a0deploying\u00a0thousands of U.S. troops to reinforce operations in the Middle East.<\/p>\n Spot\u00a0gold\u00a0has fallen more than 9% since the U.S.-Israeli strike on Iran on February 28, pressured by a stronger dollar, which has emerged as one of the clearest “safe-haven” winners.<\/p>\n Spot silver<\/a>\u00a0gained 1.5% to $76.52 per ounce. Spot platinum<\/a>\u00a0rose 0.6% to $2,035.25 and palladium<\/a>\u00a0added 1.2% to $1,492.25.<\/p>\n