Gold prices rose in European trade on Wednesday on track for the third profit in a row, trading once more above $3300 and hitting a week high as the dollar declines against major rivals.
It comes amid concerns about the US financial stability after the US credit rating cut, which increased the challenges facing US policymakers.
The Price
Gold prices rose 0.9% today to $3320 an ounce, a two-week high, with a session-low at $3285.
On Tuesday, gold rose 1.85%, the second profit in a row as the dollar weakened.
US Dollar
The dollar index fell 0.55% on Wednesday on track for the third loss in a row, plumbing a two-week trough at 99.42 against a basket of major rivals.
US President Donald Trump has failed to convince Republicans to pass his tax cuts proposal, while investors are growing cautious from potential attempts by US officials to weaken the dollar during a ministerial meeting for the G7 in Canada.
US Rates
US President Donald Trump once again called on the Federal Reserve to cut interest rates in posts on his social media accounts.
Atlanta Fed President Raphael Bostic said earlier this week that he’s leaning towards a single interest rate cut this year.
According to the Fedwatch tool, the odds of a Fed 0.25% interest rate cut in June stood at just 8%.
The odds of a 0.25%% Fed rate cut in July stood at 37%.
Traders now expect 50 basis points overall of Fed rate cuts this year, likely starting in October.
SPDR
Gold holdings at the SPDR Gold Trust rose 0.57 tons on Tuesday to a total of 921.6 tons.
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