Gold hardens from oil rise and USD retreat

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Gold price rose again above USD1,434 an ounce following a rise in the oil prices and the dollar easing. Further to that traders are expecting the interest rate hike from the European Central Bank that could also lead to further weakening of the US dollar. Even though a rise in interest rates usually are negative for the precious metal as they tend to raise the opportunity cost for investing in assets not associated with a yield but real rates are anticipated to remain low .

Gold is also profiting from anxieties that some smaller euro zone economies such as Portugal and Ireland will continue to struggle with sovereign debt, which will make their situation worse especially if the ECB goes ahead with the interest rate hike and also from the constant unrest in the Middle East and North Africa. During today’s US session the precious metal went as high as USD1438.58 an ounce and is currently traded at USD1434.39 an ounce