Gold rises over 1% as investors digest Fed hike, oil rally stalls

Spot gold climbed 1.1% to $4,310.49 an ounce by 0149 GMT, according to Business Recorder, recovering from a near six-week low touched on Wednesday. The advance came as traders weighed the US Federal Reserve's rate increase and its warning that more tightening could follow, while oil prices slipped further after reports that Saudi Arabia would offer additional crude cargoes via Oman.

Gold futures in the US for December delivery traded about 1% lower at $4,348.70. Kelvin Wong of OANDA said oil remains a key factor, and that a sustained decline could help gold move higher over the medium term, while he expects bullion to stay within a range until that happens. He also described the latest rise as largely technical, since the Fed's hawkish stance was already reflected in prices.

Gold is generally seen as a hedge against inflation, but higher rates make interest-bearing assets more attractive and reduce its appeal. The Fed raised rates on Wednesday and flagged further increases in coming months, with new chief Kevin Warsh joining a unanimous vote. Of 18 policymakers, 16 expect at least one more quarter-point hike by year-end. Other precious metals also moved higher, with silver up 1.4% at $63.83, platinum adding 1.6% to $1,780.55, and palladium gaining 2% to $1,295.00.