Mumbai, 26 Jun (Commoditiescontrol): Gold prices remained flat on Wednesday, with the market's focus on the upcoming inflation reading later this week, which is expected to shed light on the Federal Reserve's interest rate trajectory.
Spot gold held steady at $2,319.14 per ounce, while U.S. gold futures were unchanged at $2,331.00.
The dollar edged up by 0.1% against other currencies, making gold more expensive for non-dollar holders. Concurrently, benchmark 10-year Treasury yields also rose slightly.
A recent report highlighted the euro's declining status as an alternative to the dollar, prompting investors seeking to mitigate risk to turn to gold instead.
Traders are eagerly anticipating the U.S. first-quarter gross domestic product (GDP) estimates due on Thursday and the personal consumption expenditures (PCE) price index report on Friday. These reports are expected to provide further insights into the Federal Reserve's potential rate cut timeline and magnitude for this year.
U.S. consumer confidence dipped in June, reflecting concerns about the economic outlook. However, households remain optimistic about the labor market and expect inflation to moderate over the coming year.
Federal Reserve Governor Lisa Cook indicated on Tuesday that the central bank might consider a rate cut if economic conditions align with her projections, though she did not specify a timeline.
According to the CME FedWatch Tool, traders currently estimate a 65% likelihood of a rate cut in September. Lower interest rates typically reduce the opportunity cost of holding non-yielding assets like gold.
In other metals, platinum-group metals producer Sibanye Stillwater is contemplating a metals streaming, or prepayment, deal to strengthen its balance sheet in the third quarter.
Spot silver dipped by 0.1% to $28.90 per ounce, platinum increased by 0.4% to $985.83, and palladium dropped by 0.8% to $940.60.
As the market awaits the crucial U.S. inflation data, gold prices are likely to remain influenced by the strength of the dollar and Treasury yields.
(By Commoditiescontrol Bureau: 09820130172)
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