PRECIOUS gold stable while the dollar weakened, US inflation data in focus

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B.and Eileen Soreng

October 13 (Reuters)Gold remained stable on Wednesday, helped by a slight decline in the dollar as investors waited for US inflation data to gauge the Federal Reserve’s path to normalize policy.

Spot gold XAU = Little changed to 0305 GMT at $ 1,760.26 an ounce while US gold futures GCv1 rose 0.1% to $ 1,760.60.

The dollar index, which measures the greenback against six rivals, lost 0.2% and weakened from a more than a year high on Tuesday. USD /

“We will receive the US CPI data as well as the critical minutes of the FOMC meeting in September, so I think gold can receive a landmark catalyst there after this period of consolidation,” said DailyFX currency strategist Ilya Spivak.

“If the CPI warms up then we are likely to look to expectations that the Fed will have to move faster on the rate hike.”

US consumer price inflation data is due at 1230 GMT, while the minutes of the Fed’s monetary policy meeting September 21-22 will be released at 1800 GMT.

Three Fed policymakers said Tuesday the economy has recovered enough that the central bank can begin pulling its support out of the time of crisis, solidifying expectations that the Fed will begin throttling as early as next month.

As inflationary pressures mount around the world, money markets are accelerating the pricing of aggressive rate hikes and, in most cases, relying on policy to be tightened much sooner and at a much faster pace than rate-setters are signaling.

Less central bank incentives and interest rate hikes tend to drive government bond yields higher, which translates into higher opportunity costs for holding interest-free gold.

Among other things, precious metals, spot silver XAG = rose 0.2% to $ 22.57 an ounce while platinum XPT = and palladium XPD = declined 0.2% to $ 1,005.00 and $ 2,041.24, respectively.

(Reporting by Eileen Soreng in Bengaluru; editing by Krishna Chandra Eluri)

(([email protected]; within the US +1 646 223 8780, outside the US +91 80 6749 6131; Reuters Messaging: [email protected]))

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.


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