Gold rises

LONDON. — Gold rose yesterday as the dollar eased on expectations of possible delays in long-awaited United States (US) tax reforms but a looming US interest rate increase in December kept a lid on gains.

Spot gold was up 0,4 percent at $1 280,91 per ounce as of 1304 GMT. It fell about 0,5 percent on Tuesday this week.

US gold futures for December delivery gained 0,5 percent to $1 281,90 an ounce.

Senate Republican leaders are considering a oneyear delay in implementing the centrepiece tax cut to comply with Senate rules, the Washington Post reported on Tuesday, citing sources.

This pulled the dollar index, which measures the green-back against a basket of six currencies, down 0,1 percent and towards the 3-1/2 month lows touched in recent weeks.

Societe Generale analyst Robin Bhar said the news of a potential delay could mean a moderation in interest rate increases next year which would boost the appeal for gold.

“The December rate hike is baked in but the market is looking more forward on interest rates into 2018. If the tax cuts are delayed then the US Federal Reserve can be a bit more relaxed,” Bhar said.

Gold is sensitive interest rates, particularly in the US, as higher rates lift the opportunity cost of holding non-yielding assets and boost the dollar, in which it is priced.

“The closer we get to the interest rate hike in December the lower the price of gold should get,” said Natixis precious metals analyst Bernard Dahdah. — Reuters.