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Gold is rising for the fourth consecutive day based on the decline in the US dollar
Gold prices rose in the European market on Thursday, to continue their gains for the fourth day in a row, with recovery operations continuing from the lowest level in five weeks, and based on the decline in US dollar levels against a basket of global currencies.


In contrast to corrections and profit-taking, US currency levels are declining, following less hawkish statements by Federal Reserve Chairman Jerome Powell at the Economic Club in Washington, which slightly reduced the pricing of futures contracts for the possibility of raising interest rates next March.


Gold prices today

Gold metal prices rose by more than 0.5% to $1,885.46, from the opening level of trading at $1,975.58, and recorded the lowest level at $1,972.04.


Yesterday, gold prices increased by 0.1%, the third consecutive daily gain, with recovery operations continuing from the lowest level in five weeks, at $1,860.17 an ounce.


U.S. dollar

On Thursday, the dollar index fell by about 0.5%, moving away from its highest level in a month at 103.96 points, reflecting the decline in the levels of the US currency against a basket of major and minor currencies, which is in favor of the rise in the prices of gold and other metals priced in US dollars.


Federal Reserve Chairman Jerome Powell reiterated at the Economic Club of Washington on Tuesday that inflation is beginning to decline, but he warned that last week's jobs report shows why the battle against inflation will take so long, and that interest rates may need to move higher than expected.


Federal interest

Based on Powell's comments and other comments by some Federal Reserve officials, the futures contract pricing for the possibility of raising US interest rates by 25 basis points in next March decreased from about 94% to 90%.


In order to re-price those contracts, traders are awaiting next week the release of key inflation data in the United States during January, which, if it shows a slowdown in prices for the seventh month in a row, will lower the pricing of contracts above.



Gold holdings of the SPDR Gold Trust, the largest global index fund backed by gold, increased yesterday by about 0.28 metric tons, in the second consecutive daily increase, bringing the total to 921.1 metric tons, which is the highest level since last October 28.


Will gold prices rise above the $1,900 mark again?

It is not excluded that gold prices will rise above the $1,900 barrier, especially if the decline in the dollar and US bond yields continues, following the less aggressive statements of Federal Reserve Chairman Jerome Powell.

2023-02-09 09:40:15