Gold Prices Ease Ahead of US Inflation Data
Gold prices eased on Wednesday after a three-session winning streak, as investors took a cautious stance ahead of key events. Spot gold fell 0.8% to $4,618.03 per ounce by 1114 GMT, while US gold futures dropped 0.4% to $4,673.90.
The focus is now on the upcoming US inflation data, with the Personal Consumption Expenditures (PCE) report due at 1230 GMT. This will provide crucial signals on the Federal Reserve's interest rate path and its impact on gold prices.
Nikos Tzabouras, senior market analyst at Tradu.com, said that gold prices are 'technically stretched' and markets are adopting a cautious stance ahead of key events. Traders are now pricing in about a 64% chance that the Fed will leave rates unchanged next month, according to the CME FedWatch Tool.
Gold often loses its appeal in a high-interest-rate environment due to its non-yielding characteristic. However, Rhona O'Connell, head of market analysis at StoneX, noted that if Warsh remains tight-lipped about policy, then gold may see renewed easing and further interest on the basis of uncertainty.