Gold stabilizes as investors await indications from US inflation data
And gold settled in spot transactions at $ 1725.83 an ounce by 0543 GMT, after falling to its lowest level since late September at $ 1722.30 earlier in the session. And US gold futures fell 0.2 percent to $ 1722.00.
“Traders are sitting on the edge of their seats waiting for the US CPI to come out,” said Stephen Innes, managing partner at SBI Asset Management, and investors in currencies and gold are likely to make moves only when needed.
The June CPI, due to be released by the US Labor Department later on Wednesday, is expected to have accelerated on a monthly and annual basis, at 1.1 percent and 8.8 percent, respectively.
The CPI data could unite investors' expectations that the US central bank will raise interest rates by 75 basis points later in the month in an effort to rein in inflation.
Although gold is considered a hedge against inflation, high interest rates keep investors away from the non-yielding yellow metal.
And the dollar remained near its highest levels in 20 years, keeping gold priced in the US currency less attractive to buyers holding other currencies.
Ten-year US Treasury yields also rose, reducing the attractiveness of gold.
As for other precious metals, silver increased in spot transactions 0.4 percent to $ 18.97 an ounce, platinum fell 0.3 percent to $ 843.58, and palladium rose 0.2 percent to $ 2031.18.
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