Gold prices rose on Monday, as tensions in the Middle East escalated, increasing demand for the safe haven metal. Prices surpassed the $2,050 per ounce level.
There is still enough instability in the Middle East to keep investors interested in gold as a safe haven.
Investors are concerned about the growing geopolitical risks following the killing of three people in a drone strike on U.S. forces stationed in northeastern Jordan near the Syrian border.
Gold is considered a safe haven for value amid political and economic turmoil.
The markets expect the Federal Reserve to keep interest rates unchanged at its policy meeting scheduled for January 30-31, but attention will be largely focused on Powell’s remarks.
Gold and the dollar now
Gold futures are now up 0.72% to $2,051 per ounce.
Spot gold is up about 0.6% to $2,032 per ounce.
On the other hand, the dollar index is stable at 103.24 points.
Other metals
Among other precious metals, silver rose 0.85% to $22.98 per ounce in spot trading, platinum fell 0.5% to $908.42, and palladium fell 0.4% to $951.62.
The dollar is stable as investors focus on analyzing data on the US economy
The dollar started the week on a stable note as investors focused on analyzing the implications of US economic data ahead of this week’s Federal Reserve meeting, while escalating geopolitical tensions in the Middle East dampened risk appetite.
The dollar index, which measures the performance of the US currency against a basket of six rival currencies, barely changed and stood at 103.50 on Monday, staying close to its highest level in six weeks of 103.82 touched last week.
This week, investors’ attention will be focused on the two-day monetary policy meeting of the central bank, which begins on Tuesday, which is widely expected to keep the central bank’s interest rates unchanged, with the spotlight falling on remarks by Fed Chairman Jerome Powell.
Investors will also monitor a series of economic data, including US unemployment and employment reports, which will help gauge the strength of the labor market.
The euro fell 0.08% to $1.0842, on track to record a decline of two percent this month. The European Central Bank kept interest rates at a record high of four percent last week and reiterated its commitment to fighting inflation. The pound sterling rose 0.01% to $1.2704 during the day ahead of the Bank of England’s monetary policy meeting scheduled for this week, while the Japanese yen rose slightly to 148.07 to the dollar.
Oil jumps 1% after Houthi attack on fuel tanker in the Red Sea
Oil prices rose one percent on Monday on concerns about fuel supplies after a missile struck a fuel tanker operated by Trafigura in the Red Sea. This comes at a time when Russian exports of refined oil products are expected to decline as many refineries continue to be repaired after being attacked by drones.
The June Brent crude futures contract rose 83 cents to $84.38 a barrel by 2341 GMT after hitting a session high of $84.80. West Texas Intermediate (WTI) crude for June delivery rose 78 cents to $78.79 a barrel.
Senior ministers from the Organization of the Petroleum Exporting Countries (OPEC) and their allies led by Russia, known as OPEC+, are due to meet online on February 1.
Sources said OPEC+ is likely to decide its oil production levels for April and beyond in the coming weeks as the meeting will be too early to make decisions on further production policy.
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