Gold touches four-month high on Fed policy view, home-sales drop
Gold rose to the highest in more than four months after Federal Reserve officials reassured investors on the outlook for monetary policy and a gauge of U.S. new-home sale fell more than expected.
Central bank officials reiterated that they expect transitory rather than lasting price pressures from the U.S. economic rebound, damping speculation around any push to tighten policy. Declines in Treasury yields also underpinned gains in precious metals.
Gold is close to wiping out losses for 2021 after posting three straight weekly increases, with a weakening dollar and lower bond rates helping boost demand for the non-interest-bearing metal. Bullion got an extra boost Tuesday as the drop in U.S. home sales shored up the appeal of the metal as a haven.
"You have that slight miss on the U.S. data, and bond yields are creeping lower," said Bob Haberkorn, senior market strategist at RJO Futures. "That's helping gold. Gold is just acting as a safe haven today."
Spot gold rose 0.5% to $1,892.17 an ounce at 11:58 a.m. in New York after climbing as much as 0.8% to the highest since early January. Silver, palladium and platinum also advanced.