April 18 (Reuters) – Gold prices rose on Tuesday, buoyed by a weaker dollar, while investors looked for more clarity on the U.S. Federal Reserve’s rate hike path ahead.
Spot gold rose 0.4 % to $2,002.72 per ounce by 0909 GMT. U.S. gold futures were also up 0.4% to $2,015.40.
“Gold’s near-10% year-to-date climb has been largely predicated on its role as a safe haven as markets kept a wary eye over recession and financial instability risks,” said Han Tan, chief market analyst at Exinity.
Bids for a fresh record high may be curtailed until there is greater certainty to Fed rate cuts later this year, Tan added.
The dollar , raising expectations of the U.S. central bank hiking rates in May.
This weighed on gold, pushing it to a two-week low, as a stronger dollar makes gold more expensive for holders of other currencies.
Benchmark yields were near three-week highs. Gold is considered a hedge against inflation and economic uncertainties, but higher interest rates dim the non-yielding bullion’s appeal.
The CME FedWatch tool shows that markets are pricing in an 85.4% chance of a 25 basis point hike in May.
With the majority of U.S. data over the past few days pointing to an economic slowdown and a weakening dollar, the background influences remain supportive for gold, said StoneX analyst Rhona O’Conell in a note.
Focus will now be on comments from Fed officials this week before they enter a blackout period from April 22, ahead of the central bank’s May 2-3 meeting.
Markets will also watch for reports from big U.S. banks later in the day after stellar results from other banks last week. .
Spot silver rose 0.1% to $25.13 per ounce, platinum gained 0.8% to $1,056.81 while palladium shot up 3.3% to $1,610.66.
Reporting by Kavya Guduru in Bengaluru; editing by Uttaresh Venkateshwaran
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