advanced back to around US$5,000 an ounce after jumping two per cent on Wednesday, with some Asian markets closed for the Lunar New Year break and traders focused on the
’s next move on interest rates.
Bullion climbed as much as 0.9 per cent on Thursday, while silver gained as much as three per cent. Volatility in both metals has been exceptionally high in recent months, particularly since a historic rout at the end of January.
A key focus for bullion’s next decisive move will be the path of U.S.
. Fed officials appeared surprisingly wary of cutting rates when they met last month, according to the minutes of the US central bank’s Jan. 27-28 policy meeting, released Wednesday.
That could put the central bank on a collision course with
, complicating the task of the president’s nominee for chair, Kevin Warsh. Trump has spoken in favor of lower borrowing costs, which would be a tailwind for non-yielding bullion.
The dollar mostly held gains after rising on Wednesday following data underscoring a resilient American economy. U.S. industrial production rose last month by the most in nearly a year, while a separate report showed orders for core capital goods increased by more than expected in December.
Banks including BNP Paribas SA, Deutsche Bank AG and
have forecast that gold will resume an upward trend, with many of the factors that underpinned a multiyear rally still intact. Concerns over the Fed’s independence and geopolitical tensions have supported bullion.
Traders are watching developments in the Middle East, where nuclear talks between the U.S. and Iran have so far been inconclusive. After negotiations in Geneva this week, a U.S. official said Tehran’s officials would return in two weeks with detailed proposals to address gaps between the two sides. Meanwhile, a report by U.S.-based news website Axios said any U.S. military operation would likely be a weeks-long campaign.
Spot gold climbed 0.5 per cent to US$5,004.32 an ounce as of 9:50 a.m. in London. Silver rose two per cent to US$78.78. Platinum was little changed and palladium edged lower.