Gold Advances After Federal Reserve Keeps Interest Rates on Hold

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Or sign-in if you have an account.t]l626igmqzf0}}jmcc84tsg_media_dl_1.png Bloomberg(Bloomberg) — Gold rose after the US Federal Reserve kept interest rates unchanged, despite rising inflationary risks stemming from the war in the Middle East.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountBullion climbed as much as 0.8% to touch the $4,100-an-ounce mark, having gained 0.9% on Wednesday. The Fed voted 9-3 in favor of holding rates, although the fractured vote signaled growing conviction among some policymakers that higher borrowing costs – typically a headwind for non-yielding gold – may be needed later to curb resurgent price pressures.Fed Chairman Kevin Warsh insisted the latest decision wasn’t a sign of inertia at the US central bank. “If inflation continues to be elevated through the forecast period, interest rates could well be part of that solution, but I wouldn’t say it’s in isolation,” he said.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againGold is down by more than a fifth since the US-Iran war began more than five months ago, with high energy prices stoking inflationary pressures and raising the likelihood that rates will stay higher for longer. However, the metal has held near the key support level of $4,000 an ounce since late June, bolstered by a wave of dip-buying.“Overly shorted or disliked asset classes like precious metals and bonds” can expect relief rallies following the Fed’s decision, said Nicky Shiels, head of research and metals strategy at MKS PAMP SA. “Conviction is cautiously growing that this is a green light for larger re-engagement to pile into gold,” she wrote in a note, adding that $4,200 is a “key inflection point.”In the Middle East, tensions escalated after President Donald Trump said the US would strike back in response to a recent Iranian attack on an American military base in Jordan. The US and Saudi Arabia also struck Tehran-backed militants in Iraq, after Riyadh said it intercepted drones launched by Iraqi groups that were targeting its oil facilities. Oil steadied on Thursday after its biggest daily jump in more than two weeks.Spot gold rose 0.6% to $4,091.40 an ounce at 7:50 a.m. in Singapore. Silver jumped 1.1% to $58.37 an ounce. Platinum and palladium also advanced. The Bloomberg Dollar Spot Index, a gauge of the US currency, fell 0.1% after dropping 0.3% in the previous session.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.