Gold hovers near 9-month peak on slower rate-hike hopes

Gold held near nine-month highs on Monday, aided by expectations of slower interest rate hikes from the U.S. Federal Reserve.

FUNDAMENTALS

* Spot gold was little changed at $1,918.60 per ounce, as of 0014 GMT. Earlier, prices had hit $1,922.25, its highest since April 2022.

* U.S. gold futures fell 0.1% to $1,920.10.

* Market participants are mostly expecting a 25 basis points (bps) rate hike increase at the Fed’s next policy meeting.

* Lower rates tend to be beneficial for gold as they decrease the opportunity cost of holding the non-yielding bullion.

* U.S. consumers are becoming more confident that price pressures will ease considerably over the next 12 months, with a survey on Friday showing their one-year inflation expectations falling in January to the lowest level since the spring of 2021. * Premiums for physical gold rose sharply in China last week, buoyed by optimism around the country’s reopening before Lunar New Year festivities, while Indian traders offered steeper discounts as record-high local prices dented consumer sentiment.

* Spot silver edged 0.1% higher to $24.28, platinum was flat at $1,065.10 and palladium slipped 0.9% to $1,773.25.