By Ashitha Shivaprasad
(Reuters) – Gold rose on Thursday as investors awaited Federal Reserve Chair Jerome Powell’s speech for clarity on interest rates, while auto-catalyst palladium fell below the $1,000 an ounce level for the first time since 2018.
Spot gold was up 0.7% at $1,963.49 per ounce by 1:41 p.m. ET (1841 GMT) after hitting its lowest since Oct. 18 earlier in the session. U.S. gold futures rose 0.6% to $1,968.90.
“Today’s gold move is just a dollar story and there is also a technical rebound as we sold-off quite aggressively,” said Bart Melek, head of commodity strategies at TD Securities.
The dollar index steadied after rising 0.2% earlier.
[USD/]
“Gold could move above $2,100 in the second quarter of 2024 and the catalyst will be the Fed needing to start cutting rates,” Melek said.
Silver was up 1.1% at $22.77.
Gold has fallen nearly $40 after hitting $2,000 last week when escalating tensions in the Middle East boosted safe-haven inflows.
A slew of Fed officials this week maintained a balanced tone on rate decision, but noted that they would focus on economic data and the impact of higher long-term bond yields.
Powell is scheduled to speak at a conference at 2:00 p.m.
ET (1900 GMT).
Investors see a 90% chance of the Fed leaving rates unchanged in December and a roughly 70% chance of at least one cut by June next year, according to the CME FedWatch tool.
Lower interest rates boost zero-yield bullion’s appeal.
Palladium slipped over 5% to $996.67, after hitting its lowest level since 2018 at $991.53.
“Large short positions have exacerbated the downside risk for palladium,” said Standard Chartered analyst Suki Cooper.
“In the near term, supply curtailments have not materialised and demand has been weaker than expected following the UAW strike action.”
Platinum fell 0.6% to $860.87.
(Reporting by Ashitha Shivaprasad and Anushree Mukherjee in Bengaluru; Editing by Shinjini Ganguli and Krishna Chandra Eluri)
