Gold prices rose on Tuesday as strong U.S. economic data released overnight eased economic recovery concerns and helped soften demand for the dollar as a safe-haven asset. A drop in U.S. bond yields also boosted demand for the precious metal.
Spot gold edged up 0.2 percent to $1,731.69 per ounce, while U.S. gold futures were up 0.2 percent at $1,732.50 per ounce.
The dollar hit an almost two-week low versus a basket of rival currencies and benchmark 10-year note yields ease to 1.705 percent amid dovish central bank comments, with Cleveland Federal Reserve Bank President Loretta Mester telling CNBC that near-term tapering of bond purchases is unlikely.
Weaker Treasury yields translate into a lower opportunity cost for holding bullion, which pays no return.
The spring 2021 meetings of the International Monetary Fund (IMF) and World Bank are taking place this week, with discussion likely to revolve around how to steer fiscal and monetary policies in the period ahead.
U.S. Treasury Secretary Janet Yellen is among the participants of a climate discussion today while Federal Reserve Chairman Jerome Powell takes part in a panel about the global economy on Thursday.
Yellen made the case for a global minimum corporate tax rate on Monday as President Joe Biden seeks to raise levies on U.S. companies in a move that may prompt them to seek locations with lower taxes.
The Fed publishes minutes from its March meeting on Wednesday, with investors looking for insight as to what it will take for policymakers to begin tightening sooner than expected.
The material has been provided by InstaForex Company – www.instaforex.com