By Deep Kaushik Vakil
(Reuters) – Gold prices held near two-week lows on Wednesday as higher U.S. bond yields weighed on bullion’s appeal, while traders kept their eyes peeled for U.S. inflation data that could shape the Federal Reserve’s interest rate path.
Spot gold was down 0.1% to $1,910.96 per ounce by 1004 GMT, having touched its lowest level since Aug. 25 at $1,906.50 on Tuesday.
U.S. gold futures edged down 0.1% to $1,933.40.
Markets awaited the U.S. consumer price index (CPI) data due at 1230 GMT, with rising energy prices expected to push headline inflation figures higher. [O/R] [NGA/]
UBS analyst Giovanni Staunovo said the data will “keep the Fed on hold for the time being,” while it waits for data to weaken and inflation to calm down.
Staunovo added that he expects near-term gold prices in a range of $1,880 and $1,940.
Traders were mostly betting that the Fed will leave interest rates unchanged at its Sept. 19-20 policy meeting, while pricing around a 44% chance of another hike before 2024, according to the CME FedWatch tool.
A Reuters poll of economists saw the Fed waiting until the April-June period in 2024 or later before cutting rates.
Higher interest rates boost yields on competing safe-haven U.S. Treasury bonds, drawing investors away from zero-interest-bearing bullion. [US/]
Money markets raised their bets on a rate hike by the European Central Bank at Thursday’s policy meeting after a source told Reuters the ECB’s quarterly projections will put inflation above 3% in 2024.
Weakening economic growth prospects in Europe coupled with a fall in confidence in the Chinese economy is favouring a higher U.S. dollar and constraining gold’s investment appeal, ANZ analysts said in a note. [USD/] [GOL/ETF]
Silver shed over 1% to $22.86 per ounce, touching a three-week low. Platinum also fell 1.1% to $900.16 and palladium dipped 0.4% to $1,235.48.
(Reporting by Deep Vakil in Bengaluru; Editing by Varun H K)
Disclaimer: This report is auto generated from the Reuters news service. ThePrint holds no responsibilty for its content.