Gold future rebounded on Monday after after nine straight sessions of losses, due to geopolitical uncertainty and fuelling investor buying. Spot gold climbed 0.02 percent at $1,204.9 an ounce. While Gold for April delivery rose 0.35 percent to 1205.6 in the early trading. Expectation of a rate hike at Fed’s meeting this week sent gold price down roughly 2 percent last week.
Investors are closely watching the Fed’s meeting and the Dutch election on Wednesday. According to Investing.com’s Fed Rate Monitor Tool, market expectations for a rate hike this week stood at 93%. But investors will focus on the pace of rate hikes. Gold is highly sensitive to interest rate as higher rate will increase opportunity cost of holding non-yielding yellow metal.
Polls have showed that Dutch nationalist candidate Geert Wilders, who wants to take the Netherlands out of the European Union and stop Muslim immigration, has fallen behind to mainstream opponents.
Analysts at Zaner Group said: “While the April gold contract managed to initially reject the latest new low for the move and temporarily climb back above the $1,200 level on Friday, the view toward gold and silver looks to remain negative going forward.”