LONDON (CNBC) — Gold traded near an 8-month high as the precious metal’s strong start to 2023 continued, buoyed by lower yields and a weaker dollar.
Spot gold hit $1,881.5 per troy ounce, its highest point since May 9, before cooling off as U.S. Federal Reserve officials signaled further aggressive monetary policy action to combat inflation.
Gold was last up 0.32% at $1,877.56 per ounce. U.S. gold futures settled 0.1% lower at $1,876.5.
Friday’s U.S. jobs report, which showed that the labor market remains strong despite Fed efforts to cool growth, sent U.S. Treasury yields and the dollar lower, but gave gold a boost.
“The metal has also been buoyed by the reopening in China with pictures of very crowded gold markets seeing pre-Lunar demand and the PBoC [People’s Bank of China] announcing it bought 62 tons of gold during the last two months of the year,” Ole Hansen, head of commodity strategy at Saxo Bank, said in a note Tuesday.
Hansen said focus this week will be on Thursday’s U.S. CPI inflation print, and placed the “next major hurdle” for gold at $1,896/oz.
Meanwhile, David Neuhauser, founder and chief investment officer at Livermore Partners, told CNBC on Tuesday that he expects the recent momentum for gold to continue as investors determine that further currency debasement is likely to occur over the coming years.