WASHINGTON (dpa-AFX) - Despite the dollar's climb up north, gold futures settled higher on Tuesday as investors picked up the safe haven asset amid expectations of some interest rate cuts by the Federal Reserve this year.
The Fed, which is scheduled to announce its rate decision on Wednesday, is widely expected to hold rates unchanged. However, markets expect a rate cut by the Fed in March, and then another one in the second or third quarter of this year.
Regarding the current US Fed interest rates, Trump has said that he seeks to lower them by unleashing energy production and would speak to the US Federal Reserve if needed. 'I'll demand that interest rates drop immediately,' he told the World Economic Forum in Davos, Switzerland, in a virtual address last week.
The dollar index climbed to 107.96, gaining nearly 0.6%.
The dollar strengthened after U.S. President Donald Trump said he plans to impose sweeping tariffs on steel, aluminum, copper, semiconductor, and pharma imports in a push to increase U.S. production of the products.
Gold futures for January closed higher by $29.30 or about 1.07% at $2,766.80 an ounce.
Silver futures for January settled at $30.727 an ounce, gaining $0.473 or about 1.56%, while Copper futures for January climbed to $4.2205 per pound, gaining $0.0170 or about 0.4%.
A report released by the Commerce Department showed a steep drop in durable goods orders in the month of December amid a nosedive by orders for transportation equipment. The Commerce Department said durable goods orders plunged by 2.2% in December after tumbling by a revised 2% in November. Economists had expected durable goods orders to climb by 0.8%.
The Conference Board released a report on Tuesday showing its U.S. consumer confidence index decreased from a notably upwardly revised level in January. The report said the consumer confidence index slid to 104.1 in January from an upwardly revised 109.5 in December. Economists had expected the consumer confidence index to climb to 106.3 from the 104.7 originally reported for the previous month.
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