Gold Recovers Gradually Amid Anticipation of US Interest Rate Policies

Precious metals showed a slight improvement in daily trading after recording their lowest levels in two months during the previous session, as global markets await additional indicators regarding the future direction of the US central bank's monetary policy concerning borrowing costs. Spot gold registered a slight increase of 0.4 percent to reach $4127.40 per ounce by 01:01 GMT. The markets had witnessed a decline near their lowest levels recorded since the fifth of last August, as a result of pressures stemming from the rise of the American currency and government bond yields. In the same context, futures contracts for the precious metal for December delivery rose by 0.3 percent to record $4150.60. Documents from the US central bank's last meeting showed a state of division among policymakers last month regarding the justifications for increasing borrowing costs, as a team of officials considered this step necessary to limit the consequences of energy market fluctuations, while another team stressed its importance for hedging against emerging demand-driven inflationary pressures. Data from the FedWatch tool indicates that traders estimate the probability of approving an increase in borrowing costs during the current month at only 18 percent, compared to ongoing expectations of 80 percent for that to happen in December, noting that higher interest rates weaken the appeal of non-yielding assets such as bullion. On the other hand, International Monetary Fund Managing Director Kristalina Georgieva warned of risks facing the global economy due to the continued escalation of energy costs and record public debt levels, in addition to challenges associated with artificial intelligence investments, calling on governments to adopt effective preventive fiscal and monetary policies.