New York, (Business News Report)| Gold prices have recorded the worst monthly performance since last September in light of expectations of raising interest rates around the world.
The dollar index also rose in light of the US Federal Reserve’s intention to raise interest rates next March, which affected gold prices.
According to Reuters, spot gold prices fell 0.2 percent to $1,787.70 an ounce, and US gold futures fell 0.1 percent to $ 1789.20.
The US Federal Reserve plans to raise interest rates in March, assuming that the economy is not significantly affected by the spread of the Omicron variant from the Coronavirus, and that it continues to grow at a healthy pace.
Although gold is a hedge against inflation, raising interest rates increases the opportunity cost of holding the precious metal, which does not generate returns.
The dollar rise makes gold more expensive for holders of other currencies.
As for other precious metals, the price of silver in spot transactions fell 0.3 percent, to $22.36 an ounce.
Platinum rose 0.5 percent to $1,012.99 an ounce. Palladium settled at $2,377.42 an ounce, but it achieved a monthly gain of 25 percent at its best level since February 2008.
In addition, the US dollar fell yesterday, moving away from its highest levels in a year and a half, which was recorded on Friday, after the hawkish comments of an official from the US Federal Reserve pushed the US bond yield curve to its lowest level in three months.
After the Federal Reserve, at its meeting last week, indicated a rate hike in March, some investors expect policy makers to be preparing the markets for faster rate hikes this year to curb inflationary pressures.
The price of the dollar against a basket of currencies fell 0.2 percent to 97.02. It had rose to its highest level since mid-2020 of 97.44 on Friday.
The dollar’s rise of 1.6 percent, last week, was its largest rise since mid-2021.
The Australian dollar was among the first gainers against the dollar, yesterday. It rose 0.5% to $0.7043 ahead of the Reserve Bank of Australia meeting yesterday.
