Gold prices rise again after a week of losses

Gold prices rose today, amid a demand for buying after the yellow metal fell to its lowest level in almost a week in the previous session, while the focus was also on special US data on jobs in search of signs about reducing interest rates in the future.

Gold rose in spot transactions 0.8 percent to $3,961.85 per ounce by 03:46 GMT.

It fell by more than 1.5 percent yesterday, Tuesday, recording its lowest levels since October 30.

US gold futures for December delivery rose 0.2 percent to $3,970.10 an ounce.

The dollar stabilized near its highest levels in three months, which it touched in the previous session.

“It is just buying to capture winning trades with broader risk aversion in financial markets, which supports demand for gold as a safe haven,” said Jigar Trivedi, chief currency analyst at Reliance Securities.

Asian stocks witnessed heavy selling in early trading, similar to Wall Street, as investors’ concerns about exaggerated stock valuations led to a decline in confidence.

Trivedi said: “Gold is under pressure due to declining expectations of another interest rate cut this year and may see more pressure to reach $3,900 if ADP data is high.”

The Federal Reserve (the US central bank) lowered interest rates last week, and its Chairman, Jerome Powell, indicated that it may be the last reduction in borrowing costs for this year.

According to CME’s Fed Watch tool, market participants now expect a 69 percent chance of an interest rate cut in December, up from more than 90 percent before Powell’s comments.

As the US government shutdown continues, halting the issuance of official data, investors are focusing on unofficial economic reports such as the ADP employment report scheduled for release later today.

Non-yielding gold tends to rebound at low interest rates and during times of economic uncertainty.

The yellow metal hit a record high of $4,381.21 on October 20, but has fallen by about 10 percent since then.

As for other precious metals, silver rose in spot transactions 1.2 percent to $47.68 per ounce, platinum increased 0.1 percent to $1,537.10, and palladium rose 0.2 percent to $1,394.75.