Gold prices rose more than 2% on Wednesday, hitting a new high since 2008 in the previous session, as bargain hunting and a weaker dollar supported bullion.
basics
*Spot gold rose 2.2% to $5,044.74 an ounce at 0112 GMT, after gaining 5.9% on Tuesday, its biggest single-day gain since November 2008. Last Thursday, bullion hit an all-time high of $5,594.82.
* U.S. gold futures for April delivery rose 2.7% to $5,067.0 an ounce.
* The dollar fell against most major currencies except the yen on Tuesday, as traders consolidated recent gains on strong U.S. data and hopes for a less dovish Federal Reserve.
* A weaker dollar makes USD-priced bullion more affordable for holders of other currencies.
*U.S. President Donald Trump signed a spending deal Tuesday ending the partial shutdown of the U.S. government.
* The closely watched January employment report will not be released this Friday due to the partial shutdown.
* Investors are increasing bets on higher long-term Treasury yields and a steeper yield curve as incoming Federal Reserve Chairman Kevin Warsh is expected to seek lower interest rates while shrinking the U.S. central bank’s balance sheet.
*Investors expect the Fed to cut rates at least twice in 2026 and are awaiting ADP private payroll data released later in the day for further clues on the Fed’s policy path. Non-yielding bullion tends to perform better in a low interest rate environment.
* Reuters technical analyst Wang Tao said the current wave is expected to be steep and likely lead to a sharp rally into the $4,950-$5,198 range.
*Spot silver rose 2.1% to $86.92 an ounce. It hit a record high of $121.64 on Thursday.
* Spot platinum rose 2.3% to $2,260.50 an ounce after hitting an all-time high of $2,918.80 on January 26, while palladium rose nearly 3% to $1,782.85.
Data/Events (GMT) 0145 China Rating Services PMI January 0850 France HCOB General, Services PMI January 0855 Germany HCOB Services PMI January 0855 Germany HCOB General Final PMI January 0900 EU HCOB Services, General Final PMI January 0930 UK S&P Global PMI: General – Output UK January 0930 Reserve Assets Total January 1000 EU HCIP Flash YY January 1000 EU HCIP-X F, E, A, T Flash MM, YY January 1445 US S&P Global Composite, SVCS PMI Final January 1500 US ISM N-MFg PMI January
(Reporting by Ishaan Arora in Bengaluru; Editing by Sherry Jacob Phillips)
