Gold hits 5-week high on lesser U.S. Sept rate hike chance

20-Aug (Reuters) — Gold hit its highest in nearly five weeks on Thursday as the dollar eased after meeting minutes from the U.S. Federal Reserve suggested policymakers were in no hurry to raise interest rates.

Although agreeing that the economy was nearing a point where rates should move higher, Fed officials last month were worried that lagging inflation and a weak global economy posed risks too big to commit to a rate “lift-off”.

“There was a lot of discussion in the minutes about how to tighten policy and that shows that the central bank is moving toward it but there is some uncertainty about the date,” Macquarie analyst Matthew Turner said. “For gold, one would think that the direction is more important than the date.”

…”What’s supporting gold is that from unrelentingly bad news, which we saw until late July-early August, the news flow has been more bullish to gold after the Chinese central bank currency devaluation,” Macquarie’s Turner said.

[source]

PG View: Let’s be honest, the “unrelenting bad news” of July was based on the fallacy that a rate hike was imminent.