Gold moved higher on Thursday after the Federal Reserve slashed interest rates, but weaker oil prices limited gains and prevented the metal from breaking recent record highs.
Gold futures rose in after market trading on Wednesday after the Federal Reserve slashed its key interest rate by 50 basis points to 3 percent which boosted the precious metal's appeal as a safe haven for investment.
The Euro rose on Wednesday against the dollar, reaching its highest level in eight days after a top official at Europe's Central Bank played down the possibility that the bank will lower interest rates.
The Bank of England has released the minutes of the monthly meeting of the rate setting Monetary Policy Committee (MPC), showing the committee voted to keep interest rates constant in January by 8 to 1.
The head of Europe's Central Bank spoke on Wednesday about crisis management in light of the ongoing financial markets and economic turmoil, remarking on areas for improvement to avoid such major turbulent episodes.
The U.S. economy continued to grow in the final weeks of the fourth quarter but the pace of activity slackened amid subdued holiday spending and a weak housing sector, the Federal Reserve said on Wednesday. Reports from the 12 Federal Reserve districts suggest that economic activity increased modestly during the survey period of mid-November through December, but at a slower pace compared with the previous survey period, the Fed said.
U.S. consumer prices rose in December, their fastest rate in nearly two decades led by higher energy, food and medical prices causing economic growth to slow, the Labor Department reported Wednesday.
The Office of National Statistics (ONS)released figures on Tuesday showing that Consumer Price Inflation (CPI) was unchanged at 2.1 per cent in December, the same figure as in November.
Gold gained in choppy European trade on Thursday as a weaker dollar and bargain hunting lifted the metal closer to record highs.
U.S. gold futures finished above $880 on Tuesday after climbing to a record high, fueled by surging oil prices, a weakening dollar and tensions between the United States and Iran sparked demand for the precious metal.
The yen weakened across the board on Tuesday as investors waded back into risky carry trades, sparked by moderate gains in global equities and a rise in commodity prices.
Gold futures dropped on Monday, weighed down by a dip in crude oil prices and a strengthening U.S. dampening investors demand for the precious metal.
Gold drifted further away from its recent record highs on weaker oil prices and a rebound in the dollar, but analysts said on Monday that sentiment was positive.
The dollar rose on Monday after losses the previous session, as investors trimmed bets against the currency given persistent U.S. inflation pressures that may prevent the Federal Reserve from cutting interest rates aggressively.
The U.S. economy needs $100 oil like a hole in the head. The spike in oil to a fresh record on Wednesday is not single-handedly going to tip the United States into a recession. But on top of a housing slump and lingering credit crisis, it increases the head winds facing the battered U.S. consumer.
Jobs growth skidded to a near-halt in December and the unemployment rate hit a two-year high, according to a government report on Friday that raised recession fears and chances of more interest-rate cuts. unemployment rate hit a two-year high, according to a government report on Friday that raised recession fears and chances of more interest-rate cuts.
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Consumer spending rose in November, beating forecasts and easing concerns of an economic recession, while inflation raised its fastest pace in two years, the Commerce Department said on Friday.
China raised its benchmark interest rates on Thursday for the sixth time this year, in the latest in a series of tightening steps to contain inflation and prevent the world's fourth-largest economy from overheating. However, it also lowered the rate for sight deposits, in a move to encourage savers to keep their cash locked up for longer periods.
Inflation causes ECB to move interest rates if necessary
The European Central Bank is worried about inflation in the eurozone and ready 'to do whatever necessary' to avoid second-round effects, said ECB on Wednesday.
he dollar’s year end recovery extended into Wednesday trading, pushing the British pound beneath the psychologically key 2-level for the first time since mid-September. With no economic reports released from the US today, traders
U.S. stocks fell on Monday, as investor grew concerned over rising inflation, sending shares of Exxon and Caterpillar lower.
