Gold Drops to One-week Low on Rising U.S. Rate Hike Speculation
Gold futures prices resumed their decline on Thursday, on track to lose ground for a third straight session. The precious metal fell to the lowest level in more than one week, weighed down by rising expectations for a U.S. March rate increase.
Gold for April delivery dropped around 1 percent to trade below $1240.00 an ounce after Federal Reserve official Lael Brainard late Wednesday echoed her colleagues’ hawkish comments on the monetary policy. The greenback strengthened, sending the dollar index 0.4 percent higher to trade near its highest levels since Jan 4 at 102.0500.
While a strong dollar causes commodities priced in the currency less affordable for buyers using other monetary units, higher rates tend to diminish demand for non-yielding assets such as gold.
Sell Stop at 1237.00, Take profit 1231.00, Stop loss at 1240.00