PRECIOUS-Gold inches higher as dollar weakens on Fed rate cut hopes
Aug 7 (Reuters) - Gold prices edged higher on Thursday, helped by a weaker dollar on growing expectations of a Federal Reserve rate cut next month, while investors awaited U.S. President Donald Trump's nominations to the central bank's Board of Governors.
FUNDAMENTALS
* Spot gold XAU= added 0.1% at $3,372.97 per ounce as of 0057 GMT. U.S. gold futures GCcv1 gained 0.3% to $3,442.20.
* The dollar index .DXY hovered near more than one-week low after a surprisingly weak U.S. jobs data last week triggered bets for Fed rate cuts from September.
* Traders are now pricing in a 95% chance of a 25-basis-point cut next month, up from 48% a week ago, according to the CME Group's FedWatch Tool.
* The Fed may need to cut rates in the near-term in response to a slowing U.S. economy, even though it remains unclear whether tariffs will continue to push inflation higher, Minneapolis Fed President Neel Kashkari said.
* Meanwhile, Trump issued an executive order on Wednesday imposing an additional 25% tariff on goods from India, saying the country directly or indirectly imported Russian oil, adding to 25% tariffs already announced.
* Gold, traditionally considered a safe-haven asset during political and economic uncertainties, tends to thrive in a low-interest-rate environment.
* On Wednesday, Trump said that over the next few days he would likely nominate a candidate to serve the remaining months of a soon-to-be-vacant position on the Fed's Board of Governors, leaving the choice of a permanent replacement for a later date.
* SPDR Gold Trust GLD, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.33% to 952.79 tonnes on Wednesday from 955.94 tonnes on Tuesday. GOL/ETF
* Elsewhere, spot silver XAG= was steady at $37.83 per ounce, platinum XPT= gained 0.2% to $1,336.74 and palladium XPD= rose 0.7% to $1,139.98.
DATA/EVENTS (GMT) | |
0600 | Germany Industrial Output MM, Production YY SA June |
0600 | UK Halifax House Prices MM, YY July |
0645 | France Reserve Assets Total July |
1100 | UK BOE Bank Rate August |
1230 | US Initial Jobless Clm 2 August, w/e |
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