Gold Prices Rise on Softer Dollar, Geopolitical Worries
Investing.com - Gold prices rose on Tuesday boosted by the softer dollar and safe haven buying as geopolitical tensions kept investors on edge.
Comex gold futures rose $4.81 or around 0.4% to $1,289.99 a troy ounce by 04:01 AM ET (08:01 GMT).
Gold priced bounced back Monday from one-month lows as renewed concerns over tensions with North Korea and an escalating diplomatic crisis between the U.S. and Turkey underpinned safe haven demand for the precious metal.
Many investors favor gold during times of uncertainty or upheaval.
Gold prices were also boosted by the softer dollar. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last down 0.2% to 93.37.
A weaker dollar makes gold futures, which are denominated in the U.S. currency, cheaper for foreign buyers.
The slight drop in the dollar came as investors were continuing to digest Friday’s U.S. jobs report for September which supported expectations for a December rate hike by the Federal Reserve.
Interest rate futures are currently pricing in around a 90% chance of a December rate hike according to Investing.com's Fed Rate Monitor Tool.
Gold is highly sensitive to rising rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
Elsewhere on the Comex, silver futures were up 0.65%, to $1707 a troy ounce, while platinum gained 0.9% to $925.55 and palladium rose 0.66% to $934.12 an ounce.
Among base metals, copper for December delivery was up 0.3% at $3.0340 a pound.
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