LONDON: Gold edged higher on Monday as the dollar retreated on the back of lacklustre US wages data, but moves were muted ahead of an expected interest rate hike from the US Federal Reserve this week.

Spot gold was up 0.2 per cent at $1,249.47 an ounce at 1235GMT, while US gold futures for February delivery were up $3.60 an ounce at $1,252.00.

Gold is highly sensitive to rising US interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.

“The market is left with little speculative ammunition to pull prices lower on the short term,” it said. “Fundamentals on the other hand remain a headwind on longer horizons. With silver prices highly correlated to gold’s, the December rate hike, along with the three further 2018 hikes our economists expect, will weigh on investors’ appetite.”

Silver was down 0.2pc at $15.81 an ounce. Plati­num was up 0.1pc at $888.80 an ounce, after touching its lowest since February 2016 last week. Palladium was 0.5pc higher at $1,011.50 an ounce.

Published in Dawn, December 12th, 2017