Gold prices rise in world market as oil prices fall

Gold prices jumped by more than 1 percent in the world market after fuel oil prices fell. The prospect of easing conflict between the United States and Iran has somewhat calmed concerns over energy supply, and that has had a positive effect on the gold market.

According to the Reuters news agency, at 8:20am Bangladesh time on Monday (9 November), the price of spot gold in the international market rose 1.6 percent to 4,129.69 US dollars per ounce.

At the same time, the futures price of gold for December delivery in the United States also rose 1.6 percent to 4,139 dollars. Gold prices had risen by nearly 5 percent last week as well.

Reuters reported that oil prices fell in the international market as the prospect of reduced conflict between the US and Iran emerged. Investors are also waiting for new US inflation figures and the next interest rate decision of the country’s central bank, the Federal Reserve.

Oil prices began to fall after US President Donald Trump commented that the possibility of ordering a fresh strike on Iran was very low. With talks to stop the war continuing, fears of disruption to energy supply have also eased somewhat.

According to analysts, lower oil prices raise the prospect of easing inflationary pressure. That could reduce the need to keep interest rates high for a long time. Gold investment does not earn regular interest. So when expectations of lower interest rates build up, the appeal of non-interest-bearing assets such as gold increases.

However, according to CME’s FedWatch tool, traders see a 79 percent chance of an interest rate rise in December. Before the employment data was released, that probability was 71 percent.

Meanwhile, prices of other precious metals have also risen. In the international market, the price of silver rose 2.8 percent to 53.31 dollars per ounce.

The price of platinum rose 1.6 percent and palladium rose 2.1 percent.