By Ashitha Shivaprasad
(Reuters) – Gold traded in a tight range on Wednesday as market participants awaited more U.S. economic data to determine the number of rate cuts the Federal Reserve is likely to deliver in the near term.
Spot gold rose 0.2% to $2,667.01 per ounce by 0511 GMT and was $18 shy of a record high hit last month. U.S. gold futures gained 0.2% to $2,683.50.
“The game changer in gold prices is the U.S. monetary policy easing as it sets the stage for investment demand,” said ANZ commodity strategist Soni Kumari. [US/]
“The uncertainly surrounding U.S. elections and geopolitical tensions will also support gold going forward.”
Zero-yielding bullion tends to be a preferred investment in a low interest rate environment and during geopolitical turmoil.
Spot gold poised to revisit its Sept. 26 high of $2,685 as it has broken resistance at $2,666, according to Reuters technical analyst Wang Tao.
Investors are looking forward to U.S. retail sales, industrial production and weekly jobless claims data, due on Thursday, for fresh cues on the Fed’s monetary easing cycle.
Traders are pricing in a 97.2% chance of a 25 basis-point Fed rate cut in November.
San Francisco Federal Reserve Bank President Mary Daly said the central bank remains on track for more cuts this year as long as data meets expectations.
Atlanta Fed President Raphael Bostic said he pencilled in just one more 25-bp reduction this year when he updated his projections for last month’s meeting.
Delegates to the London Bullion Market Association’s annual gathering predicted gold prices would rise to $2,941 over the next 12 months and silver prices would jump to $45 per ounce.
Spot silver firmed 0.5% to $31.63. Platinum rose 1.2% to $996.20 and palladium climbed 0.4% to $1,013.01.
“We still favour platinum, although Russia and the automotive sector have recently pushed prices higher,” Intesa Sanpaolo economist Daniela Corsini said in a note.
(Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu)
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