Gold prices hit 8-month peak on US dollar pullback

Gold prices extended gains to an eight-month high today, Jan. 9, as the US dollar weakened amid rising expectations that the Federal Reserve will move to pare down future interest-rate increases.

The greenback-priced bullion rallied as the US dollar index slipped to its lowest level in seven months. Further, the yield on 10-year Treasury bonds tumbled to 3.51%.

San Francisco Fed President Mary Daly, in an interview with The Wall Street Journal, said the central bank is set to lift interest rates by 50 or 25 basis points (bps) at the coming policy meeting, to be held between Jan. 31-Feb. 1.

In terms of trading, gold for February delivery advanced 0.4%, or $8.10, to close at $1,877.80 an ounce — the highest since May 2022.

On the other hand, the US dollar index, which gauges the greenback's strength against a basket of six currencies, shed 0.7% to 103.101 points at 10:06 pm Makkah time.