Investing.com – Gold futures rallied to a fresh record high on Thursday, after the U.S.’s credit rating was put under review for a downgrade and amid expectations for further monetary stimulus by the Federal Reserve.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at USD1,585.25 a troy ounce during late Asian trade, climbing 0.25%.
It earlier rose as much as 0.82% to trade at a record high USD1,590.45 a troy ounce, eclipsing the previous day’s all-time high of USD1,587.75 a troy ounce.
Late Wednesday, Moody’s Investors Service said that it placed the U.S. government’s Aaa bond rating on review for possible downgrade for the first time since 1995, citing “a small but rising risk” of a short-lived default, amid a standoff in the U.S. Congress over raising the country's USD14.3 trillion debt ceiling.
The rating would likely be reduced to the Aa range and there is no assurance Moody’s would return its top rating even if a default is quickly cured.
Fed Chairman Ben Bernanke said that the central bank was prepared to provide additional stimulus to bolster the U.S. economy, and warned a failure by Congress to raise the debt limit would send “shock waves” through the financial system.
Testifying before lawmakers in Washington on Wednesday, Bernanke said policymakers expect the U.S. economic recovery "will likely remain moderate” with the unemployment rate falling "only gradually."
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.35% to trade at 75.28.
Gold prices often move inversely to the U.S. dollar, as gold becomes less expensive for buyers using other currencies.
Meanwhile, lingering concerns over sovereign debt contagion in the euro zone continued to underpin safe-haven demand for the precious metal.
Greece’s credit rating was cut three levels by ratings agency Fitch to its lowest grade for any country in the world, saying that a default was a “real possibility.”
Elsewhere, silver for September delivery rallied 1.4% to trade at a seven-week high of USD38.67 a troy ounce, while copper for September delivery added 0.2% to trade at USD4.401 a pound.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at USD1,585.25 a troy ounce during late Asian trade, climbing 0.25%.
It earlier rose as much as 0.82% to trade at a record high USD1,590.45 a troy ounce, eclipsing the previous day’s all-time high of USD1,587.75 a troy ounce.
Late Wednesday, Moody’s Investors Service said that it placed the U.S. government’s Aaa bond rating on review for possible downgrade for the first time since 1995, citing “a small but rising risk” of a short-lived default, amid a standoff in the U.S. Congress over raising the country's USD14.3 trillion debt ceiling.
The rating would likely be reduced to the Aa range and there is no assurance Moody’s would return its top rating even if a default is quickly cured.
Fed Chairman Ben Bernanke said that the central bank was prepared to provide additional stimulus to bolster the U.S. economy, and warned a failure by Congress to raise the debt limit would send “shock waves” through the financial system.
Testifying before lawmakers in Washington on Wednesday, Bernanke said policymakers expect the U.S. economic recovery "will likely remain moderate” with the unemployment rate falling "only gradually."
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.35% to trade at 75.28.
Gold prices often move inversely to the U.S. dollar, as gold becomes less expensive for buyers using other currencies.
Meanwhile, lingering concerns over sovereign debt contagion in the euro zone continued to underpin safe-haven demand for the precious metal.
Greece’s credit rating was cut three levels by ratings agency Fitch to its lowest grade for any country in the world, saying that a default was a “real possibility.”
Elsewhere, silver for September delivery rallied 1.4% to trade at a seven-week high of USD38.67 a troy ounce, while copper for September delivery added 0.2% to trade at USD4.401 a pound.