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PRECIOUS-Gold slips as investors prefer safety of dollar

Published 28/01/2021, 12:03 pm
© Reuters.
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Jan 28 (Reuters) - Gold prices edged lower on Thursday as investors opted for the safety of the dollar after the U.S. Federal Reserve flagged concerns about the pace of recovery in the world's largest economy.

FUNDAMENTALS

* Spot gold XAU= eased 0.3% to $1,839.21 per ounce by 0042 GMT. Prices fell to their lowest since Jan. 18 at $1,830.80 on Wednesday. U.S. gold futures GCv1 shed 0.5% to $1,835.90.

* The dollar .DXY hit a more than one-week high against rival currencies in the previous session. A stronger dollar makes gold more expensive for holders of other currencies. USD/

* The Fed on Wednesday left its key overnight interest rate near zero and made no change to its monthly bond purchases, pledging again to keep those economic pillars in place until there is a full rebound from the pandemic-triggered recession. Some U.S. states are starting to ease public health restrictions as severe COVID-19 infections are beginning to abate in many parts of the country even as the death toll mounts. Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust GLD , fell 0.3% to 1,169.17 tonnes on Wednesday. Analysts and traders have downgraded their forecasts for gold but still expect prices to recover from current levels and many see it achieving record highs this year. Silver XAG= lost 0.2% to $25.18 an ounce, platinum XPT= fell 0.2% to $1,063.76, and palladium XPD= was flat at $2,304.81.

* Platinum will burst from a decade-long stagnation this year as demand from investors and auto makers delivers the biggest annual average price rise since 2010, a Reuters poll showed. AHEAD (GMT) 1000 EU

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