NEW YORK: Gold wobbled near a one-week low on Tuesday, with price moves restrained as investors sat tight before a key US inflation report that is expected to reinforce the Federal Reserve’s bullish stance.
Spot gold was nearly unchanged at $1,668.70 per ounce at 10:59 a.m. EDT (1459 GMT). US gold futures firmed 0.1% to $1,676.10.
In the run up to the inflation data, “it’s listless trading … it’s just quiet. People don’t want to make any big moves,” said Michael Matousek, head trader at US Global Investors Thursday’s US inflation reading is expected to remain stubbornly high and cement the Fed’s hawkish rhetoric on monetary policy.
Rising US interest rates reduce non-yielding bullion’s appeal.
“(Bullion investors) have pretty much adjusted for what they think is going to happen (inflation data) so now it’s just wait and see,” Matousek said, adding that the next level of support for gold prices was around $1,614 per ounce.
Gold is on course for a fifth consecutive session of losses, its worst since mid-August.
The dollar hovered near a two-week peak, making greenback-priced bullion less appealing for overseas buyers. Benchmark US 10-year Treasury yields firmed.
“It’s hard to create a bullish case for gold”, considering peak inflation may be yet to come, with rate hikes likely to continue until such a scenario, said Craig Erlam, senior market analyst at OANDA.
Gold has shed nearly 20% since rising above the key $2,000 mark in March, as the safe haven failed to shine despite geopolitical uncertainty and a recent rout in equities as most investors sought refuge in the dollar instead.
Source: Brecorder
