By Arundhati Sarkar
(Reuters) – Gold prices edged higher in a tight range on Thursday as the dollar eased slightly while investors awaited a raft of U.S. economic data that could influence the Federal Reserve’s policy trajectory.
Spot gold ticked up 0.2% to $1,920.79 per ounce by 0726 GMT. U.S. gold futures were flat at $1,927.20.
The dollar index dipped 0.3% making gold less expensive for overseas buyers. [USD/]
“(However,) the pushback in rate-cuts timeline compared to the start of the year is driving some unwinding in gold prices from previous bullish build-up,” said Yeap Jun Rong, market strategist at IG.
Therefore, a series of labour market data will be closely watched, but much will still revolve around a continued moderation in wage pressures, he added.
Rising U.S. interest rates increase the opportunity cost of holding non-yielding bullion.
A united Fed agreed to hold interest rates steady at the June meeting as a way to buy time and assess whether further rate hikes would be needed, minutes showed.
Traders are now pricing in a 91% chance of a 25-basis-point rate hike in July.
Spot gold may retest a support at $1,914 per ounce, with a good chance of breaking below this level and falling into a $1,903-$1,909 range, according to Reuters technical analyst Wang Tao.
Investors will now focus on the U.S. Labor Department’s Job Openings and Labor Turnover Survey, and other economic data, as they keep a close watch on updates about China’s export controls on semiconductor metals and U.S. Treasury Secretary Janet Yellen’s Beijing visit.
“Further escalation on that front after the meeting could put market participants on the defensive, which may drive some near-term safe haven flows for gold prices,” Jun Rong said.
Spot silver rose 0.6% to $23.2385 per ounce, platinum edged up 0.2% to $917.08, while palladium fell 0.7% to $1,251.32.
(Reporting by Arundhati Sarkar in Bengaluru; Editing by Rashmi Aich, Elaine Hardcastle)
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