Gold climbs up amid strengthening dollar, NZ central bank interest hike

Gold edged higher on Wednesday even as the dollar recovered and New Zealand’s central bank announced a smaller-than-expected interest rate increase.

Gold futures jumped 0.54% to $1,793.45 by 12:01 AM ET (5:01 AM GMT) but stayed below the $1,800 mark. The dollar, typically moving inversely to gold, rose on Wednesday and hovered near a 16-month high.

Earlier in the day, the Reserve Bank of New Zealand (RBNZ) increased its interest rate to 0.75% and upped its long-term cash rate projection by 50 bps as it handed down its policy decision.

At a news conference, RBNZ Governor Adrian Orr said that the central bank would take a “cautious” approach in tightening by moving in 25-basis points “for now.”

Meanwhile, SPDR Gold Trust holdings went up 0.6% to 991.11 tons on Tuesday, higher than Monday’s 985 tons.

In other precious metals, silver fell 0.3%, while palladium and platinum gained 1.2% and 1.1%, respectively.