Gold Holds Steady as Equities Fall; Rate Outlook Keeps Lid on Prices
Gold prices held steady on Tuesday, buoyed by a tumble in global equity markets but pressured by expectations for more U.S. interest rate hikes this year.
Spot gold was largely unchanged at $1,338.62 an ounce at 0112 GMT, after rising 0.5 per cent on Monday.The metal on Friday fell 1.2 per cent in its biggest one-day decline since December 7. Last week, gold saw its largest weekly drop since the week ending December 8.
US gold futures were up 0.4 percent at $1,342 per ounce.
The US Federal Reserve last week held interest rates unchanged, but raised its inflation outlook and flagged "further gradual" rate increases.
Stock markets were routed around the globe as resurgent US inflation raised the possibility that the Fed would tighten policy more aggressively than previously expected.
But US interest rates futures jumped on Monday as traders dialled back expectations the Federal Reserve would quicken its pace of interest rate increases in the wake of a dramatic sell-off in Wall Street stocks, with the Dow losing over 1,000 points.
With the price of palladium spiking to a record record-high last month, the effects could be felt in the automotive industry as manufacturers of catalytic converters consider raising their prices and may change the mix of metals in their products.
International mining companies operating in the Democratic Republic of Congo are mounting a coordinated campaign against a new mining code they say will stifle investment there, Randgold's chief executive told Reuters.
India's gold imports in January dropped to their lowest in 17 months as prices rebounded and buyers postponed purchases in expectation of cuts in the import tax, provisional data from precious metals consultancy GFMS and bank dealers showed.
A third of South Africa's largest mining companies are not considering any new investments in the sector in 2018, while one of them may even decide to pull out of the country, according to an industry survey unveiled by the Chamber of Mines on Monday.
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