Gold Gets a Boost From Fed's Dovish Stance
March 21 2019 - 04:03PM
Dow Jones News
By Christopher Alessi
Metals prices were mixed on Thursday, with the precious complex
broadly boosted by the U.S. Federal Reserve's decision not to raise
interest rates further this year.
Precious Metals
Gold for April delivery rose 0.4% to $1,307.30 a troy ounce on
the Comex division of the New York Mercantile Exchange.
Gold prices found support after the Fed on Wednesday left
interest rates unchanged and signaled that it is unlikely to raise
rates further this year. The news weighed on the U.S. dollar, in
turn boosting gold. Dollar-denominated commodities like gold tend
to have an inverse relationship with the greenback.
However, the WSJ Dollar Index, which measures the U.S. currency
against a basket of 16 of its peers, ticked up 0.4% on
Thursday.
"Headwinds from the U.S. interest-rate cycle should fade, likely
lifting the mood in the gold market and providing price support
around current levels," said Carsten Menke, commodities research
analyst at Julius Baer.
At the same time, gold "also pulled the other precious metals up
with it -- in fact, they even rose somewhat more steeply than
gold," according to analysts at Commerzbank.
Among other precious metals, silver rose 0.8% at $15.437 a troy
ounce, platinum gained 0.2% at $861.10 a troy ounce and palladium
fell 0.2% to $1,557.90 a troy ounce.
Base Metals
Copper prices fell as a stronger dollar outweighed signs of a
supply deficit.
Copper for May delivery settled down 0.5% to $2.9060 a pound in
New York, reversing gains after trading as high as $2.9690 earlier
in the session.
A report from the International Copper Study Group showed that
the copper supply deficit last year was at its highest level in
four years. The deficit was largely the result of "world refined
consumption increasing 2% and production growth constrained by
smelter disruptions and temporary shutdowns for tech upgrades,"
said Alistair Munro at brokerage Marex Spectron.
--Stephanie Yang contributed to this article.
Write to Christopher Alessi at christopher.alessi@wsj.com
(END) Dow Jones Newswires
March 21, 2019 15:48 ET (19:48 GMT)
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