Investing.com | Jan 11, 2019 15:23
Investing.com - Gold prices pressed higher on Friday, on track for its fourth week of gains, as a less hawkish Federal Reserve and concern over the partial U.S. government shutdown supported demand for the precious metal.
At 10:15 AM ET (15:15 GMT), gold futures for February delivery on the Comex division of the New York Mercantile Exchange inched up $1.70, or 0.13%, to $1,289.10 a troy ounce.
Fed chairman Jerome Powell reiterated on Thursday that the central bank could afford to be patient on monetary policy, and downplayed suggestions that interest rates would be hiked twice more in 2019.
Fed vice chairman Richard Clarida echoed this idea on Thursday. “We can afford to be patient about assessing how to adjust our policy stance,” he said. This is in part because "we begin the year as close to our assigned objectives as we have in a very long time," he added.
Fed officials have recently been pushing the idea that they may well be ready to take a break from policy tightening.
Despite the fact that the Fed predicted two rate hikes in 2019, markets have essentially ruled out the possibility of a hike by the end of this year, placing the odds at just under 14%, while bets for a cut in December are at around 6%.
Gold prices are highly sensitive to rising interest rates, which lift the opportunity cost of holding non-yielding bullion.
The partial U.S. government shutdown also lifted demand for the safe haven asset as it entered its 21st day.
Friday marked the first day that the political impasse over funding for the southern border wall with Mexico officially took its toll on the pocketbooks of U.S public workers.
Paychecks, scheduled for release Friday under normal circumstances, are on hold for some 800,000 federal employees that were forced to go on unpaid leave or work without pay since Dec. 22 because of the government shutdown. Most of those workers were paid on Dec. 28 in the final two-week pay period of 2018.
With the shutdown on track to become the longest in U.S. history, traders began to worry of the negative domestic impact from a prolonged outage, spurring demand for gold.
In other metals trading, silver futures dipped 0.05% at $15.635 a troy ounce by 10:16 AM ET (15:16 GMT).
In base metals, copper edged forward 0.13% to $2.641 a pound.
Written By: Investing.com
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