Gold prices fell slightly on Wednesday, as the US dollar and Treasury yields remained firm ahead of key inflation data, which could provide more clarity on the Reserve’s interest rate path federal.
Spot gold was down 0.2% at $2,356.92 an ounce by 0334 GMT. Prices hit an all-time high of $2,449.89 on May 20.
U.S. gold futures rose 0.1% to $2,357.80.
The dollar strengthened 0.1%, making gold less attractive to holders of other currencies, while yields on benchmark U.S. 10-year bonds rose to multi-week highs.
“Investors will try to take profits and prices are trading near $2,350. So prices haven’t corrected, but this is a healthy sort of consolidation after a very strong rally last Monday,” said Soni Kumari, commodities strategist at ANZ.
“Investors will try to get into gold because the long-term fundamentals look pretty strong for gold right now.
U.S. data on personal consumption expenditures (PCE), the Fed’s preferred measure of inflation, is due Friday.
“A weaker release on U.S. household consumer spending would make it easier for gold to reclaim the $2,400 level, given the possible implications of the rate cut schedule,” said Tim Waterer, chief analyst at the market at KCM Trade, in a note.
According to the CME’s FedWatch tool, traders currently give a 57% chance of a rate cut by November.
While gold is used as a hedge against inflation, rate hikes increase the opportunity cost of holding bullion with no yield.
BHP is working to find common ground with Anglo American in negotiations over its takeover offer, without further concessions as the deadline approaches for the world’s largest miner to submit a binding offer, people said five sources.
Spot silver fell 0.4% to $31.99, platinum fell 0.7% to $1,056.06 and palladium gained 0.6% to $978.47.
The International Monetary Fund has revised upwards China’s GDP growth forecasts for 2024 and 2025 after a “solid” first quarter. China is a key consumer of ingots and other industrial metals.
