Spot Gold edged higher on Tuesday, while holding near highs not seen since May 20th, as remarks by Federal Reserve Chair Jerome Powell reinforced the case for a rate cut in September.
Yesterday the Fed Chair said that the three US inflation readings during the second quarter of 2024 “add somewhat to confidence” inflation is returning to the Fed’s target sustainably.
“Powell continued to lay the groundwork for upcoming policy easing. A rate cut in September is now fully priced in by markets, which may keep sentiments in gold prices well-supported in the lead-up,” IG market strategist Yeap Jun Rong was quoted as saying by Reuters.
Lower interest rates reduce the opportunity cost of holding Gold, which pays no interest.
Meanwhile, Fed governors Christopher Waller and Adriana Kugler are also scheduled to make speeches this week.
As of 6:28 GMT on Tuesday Spot Gold was edging up 0.35% to trade at $2,430.91 per troy ounce.
Yesterday the precious metal went up as high as $2,439.85 per troy ounce, or its highest price level since May 20th.
Gold Futures for delivery in August were up 0.27% on the day to trade at $2,435.45 per troy ounce.
Elsewhere, Silver Futures for delivery in September were gaining 0.37% to trade at $31.052 per troy ounce.
The US Dollar Index, which reflects the relative strength of the greenback against a basket of six other major currencies, was edging up 0.11% to 104.372 on Tuesday.
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