RIYADH: Gold prices rose on Wednesday to their highest level since March 2022 after weak USÂ economic data spurred safe-haven demand and expectations that the Federal Reserve might loosen its stance on monetary policy tightening.Â
Spot gold was up 0.3 percent at $2,025.49 per ounce, as of 0716 GMT, in thin trade as China and Hong Kong markets were closed for a holiday. USÂ gold futures firmed 0.2 percent to $2,042.10.Â
The dollar index hovered near two-month lows, making bullion cheaper for buyers holding other currencies.Â
"Gold could continue to tear to the upside," given a slowing global economy with high inflation, said Clifford Bennett, chief economist at ACY Securities, adding that the dollar's weakness was allowing gold to leap higher.Â
Gold prices rallied 2 percent to cross $2,000 per ounce on Tuesday after another batch of weaker USÂ economic data pointed to a slowing economy.Â
Local gold prices in India hit a record high of 61,399 rupees ($747.47) per 10 grams on Tuesday.Â
Data showed USÂ job openings in February dropped to the lowest in nearly two years, suggesting the labor market was cooling. A separate report showed new orders for US-manufactured goods fell for a second straight month in February.Â
Gold is considered a hedge against inflation and economic uncertainties, but higher interest rates dim non-yielding bullion's appeal.Â
Metals firm MKS PAMP flagged a higher risk of future bank failures and weaker economic activity as credit availability and financial conditions tighten amid a sticky inflation backdrop, which are "positive gold drivers".Â
The Fed is seen done raising interest rates and starting to cut them in the summer. But Federal Reserve Bank of Cleveland President Loretta Mester said while the economy appeared on a path towards slowing down, the USÂ central bank likely had more rate hikes ahead of it.Â
Spot silver shed 0.6 percent to $24.86 per ounce, platinum rose 0.5% to $1,022.26 and palladium was unchanged at $1,457.77.
