MTECHTIPS;-Gold holds steady despite dollar rebound

MTECHTIPS;-Gold holds steady despite dollar rebound

MTECHTIPS-Gold prices traded higher on Thursday, shrugging off a rebound in the dollar, as investors continue to pile into the precious metal amid expectations that the Federal Reserve could keep interest rates low for longer than initially anticipated. Gold futures for August delivery on the Comex division of the New York Mercantile Exchange rose by $9.70, or 0.77%, to $1,258.98.82 a troy ounce. Despite an uptick in the dollar, gold futures continued to advance, adding to gains from the prior session, as investors expected the Federal Reserve to keep rates low for a prolonged period in the wake of central bank’s unchanged rate decision. As was widely expected, the Federal Reserve stood pat on interest rates Wednesday, keeping its benchmark rate in a target range of 1%-1.25% while expressing concerns about the slowdown in inflation, pushing the dollar to fourteen-month lows. The dollar recovered, however, after economic reports showed durable goods orders for June topped expectations, offsetting a larger-than-expected rise in initial jobless claims. The U.S. Department of Labor reported Thursday that initial jobless claims rose by more than expected to 244,000 in the week ended July 23, missing forecasts of a 7,000 decline. In a separate report, core durable goods orders rose by 6.5% in June, the Commerce Department said Thursday, reflecting a sharp jump in orders for transportation equipment. Dollar-denominated assets such as gold are sensitive to moves in the dollar – A rise in the dollar makes gold more expensive for holders of foreign currency, and thus, reduces demand.

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