Tuesday, 1 October 2024 07:49 WIB | GOLD |GOLDEMAS

Gold steadied after tumbling the most since August as traders pared bets on the pace of rate cuts by the Federal Reserve.

Bullion traded above $2,636 an ounce after closing 0.9% lower on Monday, when Fed Chair Jerome Powell said the central bank would lower rates “over time,” and re-emphasized the economy remains on solid footing. His remarks pushed swaps traders to rein in bets for hefty rate cuts. Lower borrowing costs tend to benefit gold as it doesn’t pay interest.

The precious metal rallied 13% in the third quarter, the most since early 2016, hitting a series of record highs. Along with rate-cut optimism, it’s been boosted by robust central-bank purchases and increased haven demand due to conflicts in the Middle East and Ukraine and ahead of an uncertain US presidential election that’s just five weeks away. 

Spot gold was flat at $2,636.06 an ounce as of 8:33 a.m. in Singapore, below its all-time high of $2,685.58 reached on Sept. 26. The Bloomberg Dollar Spot Index was little changed. Silver edged up, after touching the highest level since 2012 last week before paring gains. Platinum and palladium dipped.

Israel, meanwhile, said it had begun “ground raids” in southern Lebanon against Hezbollah. The attacks further expand its campaign against the Iran-backed group after the killing of its leader, Hassan Nasrallah, on Friday. If the hostilities drag in Iran and lead to an all-out war in the Middle East that could boost haven demand for gold.

Looking ahead, Friday’s US jobs report for September may prove to be pivotal in shedding light on the Fed’s rate path. Raphael Bostic of the Atlanta Fed told Reuters he was open to another half-point of easing at the central bank’s November meeting if data showed slower-than-expected job growth.

Source : Bloomberg