Gold extends gains to 11-day high

Ani Salama FXStreet

The yellow metal extended gains on Tuesday, with spot climbing to a more than one-week high at the beginning of the New York session as last Friday’s NFP report continued to take its toll on the dollar, diminishing hopes of a September rate hike by the Fed.

Gold rose to an 11-day peak of $1,335.78 an ounce before losing momentum, as investors now shift their attention to ISM services PMI. The spot was last trading at $1,334.73 an ounce, recording a 0.56% gain on Tuesday.

The metal has benefitted from lower expectations of an imminent rate hike by the Fed. Still investors consider December as a possibility for such a move. The metal remains sensitive to changes in Fed funds rates, which raise the opportunity cost of holding non-yielding assets while lifting the dollar in which the metal is priced.

Author

Ani Salama

FXStreet

Ani Salama is an Economist specialized in financial markets and statistics analysis. In 2010, she joined FXstreet where she now contributes with the news section.

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