Gold ends in green as US dollar dips to lowest level since mid-May

Gold prices closed in the green today, July 11, buoyed by a weaker US dollar as investors assessed the course of monetary policy by the Federal Reserve.

Market expectations for an extended monetary tightening cycle receded after Fed’s Vice Chair for Supervision Michael Barr’s statements to a Bipartisan Policy Center meeting earlier this week.

He said, “We have made a lot of progress in monetary policy, the work that we need to do, over the last year … I would say we are close, but we still have a bit of work to do.”

A survey by the New York Federal Reserve on consumer expectations for June showed that near-term inflation projections fell to the lowest level since April 2021.

In a note to Reuters, Edward Moya, a senior market analyst at OANDA, said, contrary to expectations, fears that the Fed’s extended monetary tightening cycle would push economies into recession have supported the yellow metal’s prices.

In terms of trading, bullion for August delivery rose 0.30%, or $6.10, to end at $1,937.10 an ounce.

On the other hand, the US dollar index, which gauges the greenback's strength against a basket of six currencies, inched 0.30% lower to 101.69 points, at 08:38 pm Makkah time, after touching 101.67 points in early trading — the lowest level since May 11.