(MENAFN) On Wednesday, Gold prices remained stable as traders awaited key US inflation data, which is expected to provide further insight into the Federal Reserve’s potential timeline for its first interest rate cut this year. By 0337 GMT, gold held steady in spot transactions at USD2,319.95 per ounce, while US gold futures showed little change, standing at USD2,331.30.
The slight increase of 0.1 percent in the dollar against rival currencies made gold more expensive for those holding other currencies, compounded by a rise in benchmark 10-year bond yields. IG market strategist Yep Jun Rong commented on the situation, noting that “the rise in Treasury yields and the US dollar last night on the back of hawkish comments from the Fed has led to some weakness in gold prices this morning.”
Traders are keenly watching the release of US first-quarter GDP estimates scheduled for Thursday and the Personal Consumption Expenditures Price Index report due on Friday. These reports are anticipated to influence market expectations regarding the Federal Reserve’s monetary policy. John Runge pointed out that “risks arise with any sudden rise in inflation, which may lead to greater uncertainty about the Federal Reserve’s policies and may result in a further decline in the yellow metal.” High interest rates typically increase the opportunity cost of holding non-yielding assets like gold.
In the broader precious metals market, silver saw a modest rise of 0.1 percent in spot transactions, reaching USD28.94 per ounce. Platinum prices increased by 0.8 percent to USD989.70 per ounce, while palladium experienced a decline of 0.5 percent, falling to USD943.49 per ounce.
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