Ahead of the release of the Federal Reserve's December policy meeting minutes on Wednesday, gold prices hit a six-month high, albeit in thin trading. Spot gold was trading higher by 0.98% at $1,841.55 per ounce at the time of writing.
The dollar index fell 0.1%, making greenback-priced bullion more attractive for overseas buyers, reported Reuters.
Also Read: How To Invest In Startups
Gold is one of the best hedges against inflation and economic uncertainties, but in a higher interest rate environment, the opportunity cost of holding gold is high as the commodity does not yield interest.
The yellow metal registered a pretty flat performance in 2022. The SPDR Gold Trust GLD posted a return of just 0.78% in the last year while the iShares Gold Trust IAU returned 0.96%.
Expert Take: However, experts have been positive on gold this year. Robert Kiyosaki, the author of "Rich Dad, Poor Dad" tweeted his forecasts for the yellow metal and silver for 2023.
“I became a gold bug in 1972. I was a Marine pilot in Vietnam flying behind enemy lines hoping to buy gold at a discount because the mine was in enemy hands. Found out the price of gold is the same all over the world. I predict silver going to $75 and gold to $3,800 in 2023,” he said.
Ole Hansen, head of commodity strategy at Saxo Bank, said in a note the dollar and yield movements would be a key focus for the gold market, according to the Reuters report.
“The de-dollarization seen by several central banks last year, when a record amount of gold was bought, look set to continue, thereby providing a soft floor under the market,” Hansen said.
Read Next: Elizabeth Warren Revives Stock-Owning Ban Debate For New Congress To Start 2023 On 'Right Foot'
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.