By Harshit Verma
(Reuters) – Gold prices recouped early losses on Wednesday to trade steady as the U.S. dollar slipped from a six-week peak, while investors awaited a slew of economic reports due this week.
Spot gold was unchanged at $2,029.39 per ounce by 0815 GMT. U.S. gold futures rose 0.2% to $2,030.50.
The dollar index fell 0.3%, after hitting its highest since Dec. 13 on Tuesday. A weaker dollar makes greenback-priced bullion more attractive for overseas buyers.
Yields on U.S. benchmark 10-year Treasury notes slipped to 4.1050%.
“Recent economic data out of the U.S. has called for some recalibration in dovish market rate expectations, with some pushback on the timeline for Fed rate cut weighing on gold’s appeal,” said IG market strategist Yeap Jun Rong.
A series of economic data will be in the spotlight to move the dial around Fed rate expectations, while “rising geopolitical tensions may limit its downside … with the $2,000 level on watch as near-term support to hold,” Rong said.
Market focus is on the U.S. flash PMI report due at 1445 GMT, fourth-quarter advance GDP estimates on Thursday, and personal consumption expenditures data on Friday.
Traders are pricing in five quarter-point Fed rate cuts in 2024, down from six cuts two weeks ago.
Initially seen in March, the first cut is now expected in May with a 90% probability, according to LSEG’s interest-rate probability app IRPR.
Lower interest rates reduce the opportunity cost of holding non-yielding bullion.
A Fed official last week said the baseline for cuts to start was in the third quarter.
Spot silver rose 0.9% to $22.62 per ounce, platinum climbed 0.5% to $904.58, and palladium advanced nearly 1% to $954.77.
(Reporting by Harshit Verma in Bengaluru; Editing by Varun H K and Sherry Jacob-Phillips)
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