Gold prices steady at 19,600

Gold prices were unchanged at 19,600 baht per baht-weight in Bangkok on Saturday.

The Gold Traders Association announced the buying price at 19,500 baht and the selling price at 19,600 baht per baht-weight for bullion.

For ornaments, the buying and selling prices were 19,500 baht and 19,600 baht per baht-weight respectively.

On Friday, the prices were adjusted four times, indicating high volatility, for a total gain of 100 baht from Thursday.

Bloomberg reported from New York on Saturday Federal Reserve chair Janet Yellen dealt a blow to gold bulls who had pushed prices to the highest in a month.

Mrs Yellen on Thursday said the central bank is on track to raise interest rates this year. Her message was consistent with other policy makers who have talked up the prospect of higher rates since last week’s meeting. The Fed decided to keep rates unchanged at a record low at that gathering, citing concerns on below-target inflation and the impact of a slowdown in China.

Gold climbed 3.1% last week, the first such gain since mid-August, after the Fed decision. Higher borrowing costs curb the appeal of the metal, which doesn’t pay interest or give returns like other assets such as bonds and equities. Gold also fell on Friday after a government report showed the US economy expanded more than previously forecast in the second quarter, helping rekindle rate concerns.

“An element of gold’s decline at least is Yellen’s comments, which appeared to endorse a rate rise eventually,” James Steel, an analyst at HSBC Securities (USA) Inc in New York, told Bloomberg. “US GDP was also slightly better, and that would tend to weigh on gold as well, because it gives some backward ammunition to a rate rise.”

Gold futures for December delivery dropped 0.7% to settle at $1,145.60 an ounce at 1.48pm on the Comex in New York, the first decline in three days. The metal climbed to $1,156.40 on Thursday, the highest since Aug 24.

Fed-fund futures data conflict with Mrs Yellen’s assessment, showing traders see a 44% chance the Fed will raise rates by year-end, down from a 49% probability on Thursday. Odds climb to 52% by January, according to data compiled by Bloomberg.