Gold futures recovered after early weakness and settled modestly higher on Tuesday as the dollar shed ground amid rising hopes the Fed will slow the pace of interest rate hike to 25 basis points on Wednesday.
Gold prices fell sharply earlier in the session after the International Monetary Fund upgraded its forecast for world growth this year to 2.9% from a previous prediction of 2.7% in October.
The Fed will announce its interest-rate decision on Wednesday. Economists expect a 25-basis-points rate hike to a range of 4.5% to 4.75% amid signs of slowing inflation.
The dollar index, which climbed to 102.61 in the Asian session, dropped to 102.03 this afternoon, losing about 0.25%.
Gold futures for April ended higher by $6.10 or about 0.3% at $1,945.30 an ounce, rallying from a low of $1,915.50 an ounce.
Silver futures for March ended up $0.103 at $23.836 an ounce, while Copper futures for March settled at $4.2260 per pound, up $0.0240 from the previous close.
Data from the Labor Department showed employment cost index wages in the U.S. increased by 1% on quarter in the fourth quarter of 2022, after rising 1.3% in the previous quarter.
The S&P/Case-Shiller Home Price Index in the United States decreased 0.8% month-over-month in November of 2022, the same as in October and marking a fifth consecutive decline.
A report from the Institute for Supply Management (ISM) said the Chicago PMI in the United States fell back to 44.3 points in January of 2023 from 44.9 in December and compared to market forecasts of 45. The reading pointed to a fifth consecutive month of contraction in business activity in the Chicago region.
Meanwhile, the Conference Board’s consumer confidence index came in with a score of 107.1 in January, after coming in at a revised 109.0 a month earlier.
The material has been provided by InstaForex Company – www.instaforex.com
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