Bengaluru — Gold prices slipped on Wednesday as the dollar ticked up, while investors awaited a key US inflation report due this week for more clarity on the size of a likely September rate cut.
Spot gold fell 0.4% to $2,514.11/oz by 3.13am GMT. Bullion hit a record high of $2,531.60 on August 20. US gold futures were down 0.2% to $2,549.00.
The dollar index was up 0.1%, diminishing gold’s attractiveness for foreign currency holders.
“Market seems to be waiting for a catalyst to ignite the potential bullish breakthrough above that $2,532 level,” said Kelvin Wong, Oanda senior market analyst for Asia-Pacific.
The short-term trend for gold remained strong, with the potential to hit new highs. In the longer term, it could face resistance around the $2,585/oz-$2,595/oz range, Wong said.
Market participants are looking forward to the release of the US personal consumption expenditures (PCE) data, the Federal Reserve’s preferred measure of inflation, on Friday.
Traders have fully priced in a Fed easing for in September, with a 67% chance of a 25 basis point (bp) cut and about 33% chance of a bigger 50bp reduction, according to the CME FedWatch tool.
Non-yielding bullion tends to thrive in a low-interest-rate environment.
Fed chair Jerome Powell last week endorsed an imminent start to rate cuts and expressed confidence that inflation is within reach of the US central bank’s 2% target.
A report on Tuesday showed that US consumer confidence rose to a six-month high in August but Americans are becoming more anxious about the labour market.
China’s net gold imports via Hong Kong in July rose by about 17% from the previous month, the first gain since March, data showed on Tuesday.
Among other metals, spot silver slipped 0.7% to $29.78/oz, platinum rose 0.3% to $956.00 and palladium fell 0.4% to $966.40.
Reuters
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