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Gold ticks higher on downward revision to U.S. GDP, Yellen ahead

Published 08/26/2016, 09:02 AM
© Reuters.  Gold higher after downward revision to U.S. GDP, Yellen speech eyed
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Investing.com - Gold prices ticked higher on Friday as the dollar dipped following a slight downward revision to U.S. second quarter economic growth, but investors remained wary ahead of a key speech by Federal Reserve Chair Janet Yellen later in the day.

U.S. gold futures for December delivery were up 0.79% at $1,335.3 an ounce by 0858 ET from around $1,331.45 earlier.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, dipped to 94.53 from around 94.59 earlier.

The Commerce Department said U.S. economic growth for the second quarter was revised slightly to an annual rate of 1.1%, from an earlier estimate of 1.2%.

The dollar remained on the defensive as traders waited to see if the speech by the Fed chief at the Jackson Hole central bank symposium later Friday would provide any fresh indications on the future path of U.S. interest rates.

Yellen could restate the hawkish view of the U.S. economy expressed by Fed officials in recent weeks or echo the minutes of the Fed’s July meeting, which indicated that officials are divided on when to raise rates.

Recent upbeat comments by Fed officials were seen as boosting the prospects for a rate hike this year.

An increase in interest rates would boost the greenback by making it more attractive to yield-seeking investors, while weighing on gold by making it more expensive for holders of other currencies.

Among other precious metals, silver futures for September delivery were up 1.03% to $18.67 an ounce. Copper for September delivery was up 0.41% to $2.084 a pound.

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