Canadian maple leafs sit on the faces of one ounce gold coins in London, the United Kingdom, on July 15, 2014.
Chris Ratcliffe | Bloomberg | Getty Images
Gold prices were up 1% on Tuesday, having risen above the key $1,800 level, once again supported by a weaker dollar, as investors looked to minutes from the Federal Reserve’s June meeting for more insights into policy decision.
Spot gold rose 0.8% to $1,805.51 per ounce by 0905 GMT, after touching its highest since June 17 at $1,808.91.
U.S. gold futures jumped 1.2% to $1,805.20.
“Gold seems to be drawing strength from a weaker dollar,” said Lukman Otunuga, senior research analyst at FXTM.
“While (last week’s) mixed jobs data has somewhat eased rate hike fears, these concerns may be revived by higher energy costs and economic data pointing to rising inflationary pressures,” Otunuga added.
The dollar index dipped 0.1%, moving further away from a three-month high hit last week, making gold less expensive for other currency holders.
Data on Friday showed U.S. companies in June hired the most workers in 10 months, but the unemployment rate ticked higher, soothing some concerns over an earlier than expected policy tightening and helping gold clock up a weekly gain of 0.4%
Gold could rise further “provided there is no major shift in tone emerging from the Fed minutes being published tomorrow,” Ricardo Evangelista, a senior analyst at ActivTrades said.
Additionally, risk appetite will also be important in defining sentiment of investors in gold, as the market is buoyant, which is not supportive for bullion, Evangelista added.
Focus this week is on minutes from the Fed’s latest meeting due out on Wednesday, after a hawkish tilt from the U.S. central bank last month in which policymakers projected a start to rate hikes in 2023, sending gold prices below the $1,800 level.
Higher interest rates increase the opportunity cost of holding bullion, which pays no interest.
Elsewhere, silver rose 0.7% to $26.63 per ounce, platinum climbed nearly 1% to $1,108.10, and palladium gained 0.8% to $2,835.42.