Gold prices stabilized on Thursday after falling to a two-week low in the previous session, as investors await US inflation data to know when the Federal Reserve will cut rates. ‘interest.
Spot gold was unchanged at $2,299.55 an ounce, as of 0255 GMT. Bullion fell to its lowest level since June 10 on Wednesday.
U.S. gold futures were down 0.1% at $2,310.20.
The dollar remained near an eight-week high, making bullion more expensive for holders of other currencies, while benchmark 10-year yields remained firm.
“The rise of the US dollar, accompanied by a rise in bond yields, has left the price of gold swimming against the tide,” said Tim Waterer, chief market analyst at KCM Trade.
Fed Governor Michelle Bowman reiterated her basic view Wednesday that “inflation will continue to fall with the policy rate unchanged” and that rate cuts will “eventually” be appropriate if inflation increases. sustainably close to 2%.
Data due this week includes first-quarter US gross domestic product estimates, due at 1230 GMT, and personal consumption expenditures (PCE) inflation data on Friday.
“If the PCE index results leave financial markets pessimistic about the date of the Fed’s first interest rate cut, gold could fall back towards the $2,270 level,” Waterer added.
Although gold is considered a hedge against inflation, rising interest rates increase the opportunity cost of holding this asset without yield.
“Gold prices remain caught in a tug of war between a less dovish Fed and elevated levels of geopolitical tension,” BMI analysts said in a note dated Wednesday. “The main driver of lower gold prices in the longer term will be a sense of increased risk as the global economy recovers in the latter part of the decade.”
Spot silver fell 0.1 percent to $28.74, platinum fell 0.3 percent to $1,007.33, while palladium gained 0.2 percent to $930.39.
